Tag Archive | "investments"

Profit From Fear


Fear is pushing the US stock market higher.

stock market

Stock markets are up but interest rates have crashed to the and through the floor.

In many countries the interest rate is below zero.  Investors pay to hold bonds in many currencies.

This current global economic scenario is one that I don’t think we have ever stumbled across before.

Fear is creating a bull stock market, but normally fear pulls markets down.

It’s greed that pushes them up.

Normally fear based appreciation is only very short term and comes via hoarding… when panic is the ruling emotion.

The fear is caused by low interest rates.  Investors fear that their money will not keep pace with inflation. 

We should never count on extraordinary returns.  A key to good investing is to be realistic.

Yet we should expect something for our capital… enough to counter inflation at least.

Realistic thinking is one of the most important assets we can have as investors, yet it is easy to apply short term economic data to understand long term trends.  When this happens our conclusions can be unrealistic.

By the way….in some instances, 50 years can be short term.

My realization that economics might be different began when I was watching low interest rates in December 2015.   The interest we could gain on our savings had plunged due to the Great Recession.

A New York Times, article at that time, “Low Interest Rates May Stick Around” (1), gave me glimpse of the long term US dollar, interest rate history.  This review suggested that those who began investing in the 1960s or later (aka me), may have had a distorted understanding of interest rates.   We expected interest rates to be too high.  Our thinking might have been, “I can’t wait for interest rates to return to normal.”

The article included the chart below.

wsj.com

The theme of the article was that dollar interest rates (in 2015) may have been closer to the norm than during a 50 year high rate aberration.

This suggested that my base of understanding gained from investing through 50 years of of interest rates, may have been  unrealistic.

It was!  My understanding of interest rates was way off in 2015.  Interest rates globally were going to fall further rather than rise.

In much of the world, interest rates have fallen BELOW zero.  In the US they are around 2%.  The difference between interest rates in other currencies and the higher US rate has pushed the US dollar and US stock markets so high that they are a bad value.

Yet we as investors have nowhere else to go.

The September 2019 Advisory Extra Report (2) looked at the global low interest rate phenomenon.

ENR Asset Managers is one of the very few SEC registered investment management companies that can help US investors bank and hold assets with non US banks.  The Advisory Extra is produced by ENR for its largest clients and is only available to these large clients and our Purposeful Investing Course (PI) subscribers.

This month’s ENR Advisory delves into this problem of low interest rates in its feature review entitled: “The ‘Swissification’ of Bond Markets Coming Soon to U.S. Shores”.

The advisory says: With approximately one-third of the world’s sovereign government bonds now yielding a negative interest rate, investors are scrambling for a positive yield.

Amid a secular U.S. dollar bull market since late 2011 combined with a meltdown in major government bond yields since this summer, global investors are lunging after one of the few remaining positive-yielding bond markets – U.S. Treasury securities and corporates.

The inversion of the U.S. yield curve started last year and has since spread more meaningfully since spring when 90-day Treasury bills began to yield more than five and ten-year T-bonds. By summer, a full inversion included the widely followed 2s and 10s, meaning two-year T-bonds began to yield more than ten-year T-bonds. The anomaly has spooked the stock market ever since, including two big market plunges in August.

I have created a three part report on what to do about low interest rates because seeking value in investing and business is a key to gaining profit from the low interest rate fear.

Here are seven important rules for value investing.

#1: We know less than we think we do.  That’s OK.

#2: Risk is our partner.  Embrace it.

#3: Truth is not created by repetition of an error.

#4: Don’t care too little about strategy.  Don’t care too much about daily volatility.

#5: Do not underexpose yourself for the long term.  Don’t make too many short term decisions and not enough long term decisions.

#6: Don’t count on extraordinary returns.

#7: Look for contrasts & trends that create value.

The fact that there is always something we do not know creates the great enemy of good investing… worry.

A poll of 3,257 people by Allianz Life Insurance Co. of North America found that 92 percent agreed that the United States is facing a crisis in its retirement system. The respondents aged 44 to 54 said they worried that they won’t be able to cover basic living expenses in retirement.

This issue is complicated by the deterioration of private investments and savings. Investors who were burned by the stock market correction of 2008 worried so much about losing more that they did not stay in and ride through the storm or reenter after the correction had bottomed. As a result, these investors haven’t seen much increase in the value of their assets, except maybe the price of their home. House prices have increased since the recession, but not necessarily enough to retire on.

Adding to the trauma is the economy’s low interest rate environment. Savers can’t earn much of a return in savings or bonds, because interest rates are at record lows to stimulate economic growth. Investors used to be able to earn 4% to 6% without great risk. Now they earn much less and are living longer, so they will need their money to last longer. The low interest rates and high Wall Street prices have many worried.

Eliminate worry with the value of value.

Normally when great value is offered in markets, the smart investors ease in.

Most investors however jump into poor value markets that look good in the short term.  Now the coincidence of high US share prices and low interest rates have created a fear driven bull market.

The silent panic driving share prices up continues to strengthen the US dollar which is why you and I can enjoy prosperity during these times of rapid change.  We can increase the value of our savings and investments by diversifying in good global value equity markets now.

Part II of this report comes Saturday, September 14, and looks at why interest rates are likely to fall even further and has three tips on how to profit from this fact.

Gary

Gain From Election Volatility

Here we are again… another election on its way… all the robo calls from politicians… the dirty tricks and the innumerable amounts of nonsense this vital process brings.

However America’s politics turn out, one thing is sure.  There will be volatility in stock markets during the election process.

The first reason markets will bounce has nothing to do with politics or policies.   A market correction is due regardless of the party or the person in office.

Second the new politics has created an uncertain era.  Everyone has been shaken over the past three years whether they are pleased with the government or not.

Nothing frightens markets like uncertainty.

Third if we see rising interest rates, this will push markets down.

Despite these pitfalls, there is a way to profit using the strong US dollar and undervalue non dollar stock markets to pick up good value shares.

During nearly five decades of global investing I have noticed found that good value strategies are the best way to profit long term, through good politics and bad.  The steps to take are simple.

The first tactic is to seek safety before profit.

We can look at Warren Buffett’s investing strategy as an example.  Buffett success is talked about a lot, but rarely does anyone explain how he make so much money.  That was the fact until some researchers really stripped his operation bare.  They looked at everything and learned the deepest of Buffett’s wealth management secrets.  Fortunately they published all in a research paper at Yale University’s website. that reveals important truths about extending wealth.

This research shows that the stocks Buffett chooses are safe (with low beta and low volatility), cheap (value stocks with low price – to – book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios).

The second tactic is to maintain staying power.  At times Buffet’s portfolio has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

A 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of outperformance to 70%.

However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio the better the odds of outstanding success.

The Buffett strategy integrates time and value for safety and profit.

A third tactic is using limited leveraging, tactic in the strategy boosts profit.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.   The Yale published research paper shows the leveraging methods used by Warren Buffett to amass his $50 billion fortune.  The researchers found that the returns from Buffett’s investment company, Berkshire Hathaway, far outweighed those achieved by any rival that has operated for 30 years or more.  The research shows that neither luck nor magic are involved.  Instead, the paper shows that Buffet’s success hinges on using leverage at the rate of 1.6.

To sum up the strategy, Buffet uses limited leverage to invest in large purchases of “cheap, safe, quality stocks”.  He limits leverage so he can hold on for very long periods of time, surviving rough periods where others might have been forced into a fire sale or a career shift.

Stated in another way buffet uses logic (buy good value) to have the conviction, wherewithal, and skill to invest with leverage over many decades.

What do we do when we are not Warren Buffett?

May I introduce the Purposeful Investing Course (Pi) for those who want to invest like Warren Buffet, but know they are not.  This course is based on my 50 plus years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy Extending Wealth

Pi’s mission is to make it easy for anyone to create a three point strategy, like Buffett’s even though they do not have a lot of time for or knowledge about investing.

Pi reveals investing secrets and the sciences that make investing easy, safer, less time consuming and increases the chances of profit.

One secret is to invest with a purpose beyond the cash.  One tactic as mentioned is staying power.  This means not being caught short and having to sell during a period of loss.  This also means having enough faith in a strategy that we stick to the plan.  When we invest with purpose, doing what we love, we enjoy the process more and are more likely to hold on during down times, when most poor investors panic and sell.

Slow, Worry Free, Good Value Investing

Stress, worry and fear are three of an investor’s worst enemies.  They create the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market sector they choose.  The behavior gap is created by natural human responses to fear.   Pi helps create profitable strategies that avoid losses from this gap.

Spanning the Behavior Gap

Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse.

Winning investors though embrace risk because they have a plan based on good value.

Purpose is the most powerful motivator,  stronger than fear and greed, so a strategy with purpose is the most powerful of all.

Combine your needs and capabilities with good value secrets and the math to back up your value selections through the Pifolio – The Pi Model Portfolio

Lessons from Pi are based on the creation and management of a Primary Pi Model Portfolio, called the Pifolio.  There are no secrets about this portfolio except that it ignores the stories (often created by someone with vested interests) and is based entirely on good math.

The Pifolio is a theoretical portfolio of MSCI Country Benchmark Index ETFs that cover all the good value markets using my (almost) 50 years of global experience and my study of the analysis of four mathematical investing geniuses (and friends).

The Pifolio analysis begins with a continual research of international major stock markets that compares their value based on:

#1:  Current book to price

#2: Cash flow to price

#3: Earnings to price

#4: Average dividend yield

#5: Return on equity

#6: Cash flow return.

#7: Market history

We follow this research of a brilliant mathematician and have tracked this analysis for over 20 years.    This is a complete and continual study of international major and emerging stock markets.

This analysis forms the basis of a Good Value Stock Market Strategy.   The analysis is rational, mathematical and does not worry about short term ups and downs.   This strategy is easy for anyone to follow and use.  Pi reveals the best value markets and provides contacts to managers and analysts and Country Index ETFs so almost anyone can create and follow their own strategy.

A country ETF provides diversification and cost efficiency by spreading one simple, even small investment into a basket of equities in a good value stock market.  The costs are low and this type of ETF is one of the hardest for institutions to cheat.  Expense ratios for most ETFs are lower than those of the average mutual fund.

Little knowledge, time, management or guesswork are required.  The investment is simply a diversified portfolio of good value indices.  Investments in an index are like investments in all the shares of a good value market.

Pi matches this mathematical certainty with my fifty years of experience. This opens insights to numerous long term cycles that most investors miss because they have not been investing long enough to see them.

For example in the 1980s, a remarkable set of two economic circumstances helped anyone who spotted them become remarkably rich.  Some of my readers made enough to retire.  Others picked up 50% currency gains.  Then the cycle ended.  Warren Buffett explained the importance of this ending in a 1999 Fortune magazine interview.  He said:  Let me summarize what I’ve been saying about the stock market: I think it’s very hard to come up with a persuasive case that equities will over the next 17 years perform anything like—anything like—they’ve performed in the past 17!

I did well then, but always thought, “I should have invested more!”  Now those circumstances have come together and I am investing in them again.

The circumstances that created fortunes 30 years ago were an overvalued US market (compared to global markets) and an overvalued US dollar.

The two conditions are in place again!  There are currently ten good value (non US) developed markets,  plus 10 good value emerging markets.

Pi shows how to easily create a diversified, worry free portfolio in some of these good value markets using Country Index ETFs.

The current strength of the US dollar is a second remarkable similarity to 30 years ago.   The dollar rose along with Wall Street.  Profits came quickly over three years.  Then the dollar dropped like a stone, by 51%  in just two years.  A repeat of this pattern is growing and could create up to 50% extra profit if we start using strong dollars to accumulate good value stock market ETFs in other currencies.

This is the most exciting opportunity I have seen since we started sending our reports on international investing ideas more than three decades ago.  There is so much more to write and the trends are so clear that I have created a short, but powerful report “Three Currency Patterns For 50% Profits or More.”   This report shows how to earn an extra 50% from currency shifts with even small investments.  I kept the report short and simple, but included links to 153 pages of  Good Value Stock Market research and Asset Allocation Analysis.

The report shows 20 good value investments and a really powerful tactic that shows the most effective and least expensive way to accumulate these bargains in large or even very small amounts (less than $5,000).  There is extra profit potential of at least 50% so the report is worth a lot.

This report sells for $29.95 but you’ll receive the report “Three Currency Patterns For 50% Profits or More” FREE when you subscribe to Pi.

Leverage

Pi also explains when leverage provides extra potential without undo risk.  For example in 1986 I issued a report called “The Silver Dip” that showed how to borrow 12,000 British pounds (at almost 1.6 to 1 dollars per pound the loan created US$18,600) and use the loan to buy 3835 ounces of silver at around US$4.85 an ounce.

Silver had crashed, I mean really crashed from $48 per ounce.  As prices decreased from early 1983 into 1986, total supply had fallen to 449.7 million ounces in 1986.  Mine production was restricted by the low prices at this time, with silver reaching a low for this period of $4.85 in May 1986.  Secondary recovery also was constricted by these low prices.

Then silver’s price skyrocketed to over $11 an ounce within a year.  The $18,600 loan was now worth $42,185.

The loan was in pounds and in May 1986 the dollar pound rate was 1.55 dollars per pound.  So the 12,000 pound loan purchased $18,600 of silver.  The pound then crashed to 1.40 dollars per silver.  The loan could be paid off for $13,285 immediately creating an extra $5,314 profit.  The profit grew to $47,499 in just a year.

Conditions for the silver dip have returned.  The availability of low cost loans and silver are at an all time low.  The price of silver has crashed from nearly $50 an ounce to below $14 as did shares of the iShares Silver ETF (SLV).

finance.yahoo.com chart SLV

iShares Silver Trust (symbol SLV) from www.finance.yahoo.com

Imagine investing in a spike like this… with leverage!

At the same time the silver gold ratio hit 80, a strong sign to invest in precious metals.

I have updated a special report “Silver Dip 2019” about a leveraged silver speculation that can increase the returns in a safe portfolio by as much as eight times.  The purpose of the report is to share long term lessons gained through 30 years of speculating and investing in precious metals.  While working on the report, when the gold silver ratio slipped to 80 and the price of silver dropped below $14 an ounce, I knew I needed to share this immediately.

I released a new report “Silver Dip 2015” so readers were able to take advantage of these conditions and leverage 1.6 times as a speculation.  That report generated profits as high as 212% and a revised 2019 issue has been produced.

“The Silver Dip 2109”  sells for $39.95 but  you receive  “Silver Dip 2019” FREE when you subscribe to Pi.

Save

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive the $29.95 report “Three Currency Patterns For 50% Profits or More” and the $39.95 report “The Silver Dip 2019” free.

Triple Guarantee

Enroll in Pi.   Get the first monthly issue of Pi, and the report “Three Currency Patterns For 50% Profits or More” and “The Silver Dip 2019” right away.

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free purposeful investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  I guarantee you can keep “Three Currency Patterns For 50% Profits or More” and “The Silver Dip 2109” report as my thanks for trying.

You have nothing to lose except the fear.   You have the ultimate form of financial security to gain.

Subscribe to the Pi for $197.   You Save $158.95.

Gary

 

 

 

(1)  www.nytimes.com why very low interest rates may stick around

(2) ENR Asset Management

 

 

Common Sense Investment Reflections


We need common sense investments in a world that has been turned upside down by accelerating technology and change.

Over 51 years of living, investing and doing business around the globe has taught me that common sense is never common thought!

The thundering herd is usually wrong.

businessinsider

Image from conservationbytes.com (1) Investors loading up on the US dollar.

Common Sense investing requires independent thinking!

Let’s take betting against the US dollar as an example.  Long term (ie 50 years) the US dollar has remained on a downhill slide.  When I began investing in currencies, a US dollar bought four Swiss francs.  Recently the greenback would only fetch about .75 francs.  (This is one reason we say no to investing in Swiss francs for safety now.)

There have been times… such as 1980 shown in this chart from Grandfather.com (below) when the dollar strengthened so much it took years before it dropped. That’s a terribly long time if you are speculating against the buck.  Long enough in fact to go broke!

The dollar had every reason to go down but economic concerns cause the thundering herd to rush back to the dollar when they lack an easy alternative.

multi-currency-debt

Veginning in 2008, during the great recession, the US dollar began a jagged but steady strengthening.

dollar chart

The U.S. Dollar Index (USDX, DXY, DX) shows the US dollar relative to this basket of foreign currencies.

Euro (EUR), 57.6% weight
Japanese yen (JPY) 13.6% weight
Pound sterling (GBP), 11.9% weight
Canadian dollar (CAD), 9.1% weight
Swedish krona (SEK), 4.2% weight
Swiss franc (CHF) 3.6% weight

Since the greenback gained extra strength in 2015, the index has been hovering around 100.

The 100 mark is significant due to its rarity.  A look at a long term chart of the index shows it has only breached this barrier four times since 1967.

wiki

A US dollar index at 100 is an opportunity.

When a commodity reaches an all time high price… and there is no fundamental reason for that strength… the thundering herd is operating on common thought, not common sense.

Any time the US dollar index reaches 100, plan to switch any leverage you have to the US dollar, especially if you are investing in non dollar investments.   This will create a long term forex opportunity described in the Borrow Low details below.

You can watch the US dollar index at finance.yahoo.com (2)

Gary

Borrow Low – Deposit High

Turn $250 into $51,888… in Four Years or Less.   If someone offers you a deal like this, I would normally say “Run as fast as you can!”

Yet in 1986. This is exactly what I wrote in a report, The Silver Dip”  that told how to borrow British pounds to buy silver.  I must admit it. I was wrong. Readers who followed the report made nearly that amount ($46,299 to be exact) in only one year!

I have been updating this report since.  The last update showed how to get 2% loans that turned $39.95 into $28,185 profit.

Now is the time to borrow low and earn high again because… an amazing investing trend is taking place.

Most investors will miss it.   You do not have to lose out.

Let’s take a look why.

I have been helping readers use a little known, easy loan investing technique for over 30 years.   Almost any investor can get the loans.

The $39.95 is for a report that explains how to borrow $10,000… no loan application required.   You’ll  get the lowest interest rates in town according a Barron’s online review.

Right now the loan interest rates are between 1.41% to 2.66%.

Here is what happened the first time I issued this report over three decades ago.

The year was 1986.  The price of silver had crashed, I mean really crashed from $48 per ounce down to $4.85 in May 1986.  

Everyone was afraid of investing in silver.

But I had been investing and writing and speaking about global investments since 1968.   When I issued the Silver Dip in 1985 I  had nearly 20 years of experience, so knew that when fear rules a market, the chance of profits are high.

As prices decreased from early 1983 into 1986, total supply of silver had fallen to 449.7 million ounces.  Mine production was restricted by the low prices at that time.  Secondary recovery of silver was constricted by low prices as well.

Then a “special silver pricing position” fell into place.

I showed readers how to borrow 10,000 British pounds at cheap interest rates, to invest in silver.   A British pound at that time was worth $1.86 so the loan was sufficient to buy 3,835 ounces of silver at $4.85 per ounce.

Silver’s price skyrocketed to over $11 an ounce within a year.  By 1987 the 3,835 ounces of silver was worth $42,185.

The profit did not stop there!

The loan was in British pounds.  By May 1987 the pound had dropped from $1.86 per pound to only $1.40 per pound.  The 10,000 pound loan that had been worth $18,600 in 1986 only required $14,000 to pay it off in 1987.

The falling pound had created an extra $4,600 profit.

Do the math: 

Silver worth $42,185

Loan payoff  $14,000

Profit             $28,185

Cash Required  Zero

All of this profit was made on the 10,000 pound loan.  No extra cash was required on the investor’s part.

The $28,185 was pure… extra profit.

Let me add that some investors had borrowed even more.  Some less.  The report showed a loan to risk formula that investors could follow.

That was in the 1980s.  Silver’s special pricing position” does not happen often (this is why most investors miss it).

Nearly 30 years passed before the “silver’s special pricing position” fell into place again.

Conditions for the silver dip returned 30 years later in 2015.  The availability of low cost loans and silver’s price were perfect.

With investors watching global stock markets bounce up and down, most missed this important profit generating event. 

My readers did not.

I had been watching the entire 30 years for “silver’s special pricing position” to return.

I had been watching currency shifts and interest rates distortions so I knew the best currency to borrow.

From 2011 to 2015 the price of silver had once again crashed from $48.35 to below $14 an ounce.

The “special silver pricing position” reappeared.

I dusted off the “Silver Dip” and updated it to the “Silver Dip 2015”.

I prepared a “Silver Dip 2015” report and shared it immediately.  

The report paid off again.

From July 2015 to July 2016, the price of the silver ETF  iShares Silver Trust (Symbol SLV) rose from $13.92 and ounce to $18.71.  You can see the rise in the finance.yahoo.com chart below.

yahoo

A 10,000 pound loan (the pound was $1.52 per pound) purchased 1091 shares of the silver ETF SLV.   Those Shares rose to be worth $20,421 by 2016, a 34.34% additional profit.

The profit did not stop there!

The loan again was in British pounds.  From 2015 the pound dropped from $1.52 dollars per pound to only $1.39 dollars.  The 10,000 pound loan that had worth $15,200 in 2015 only required $13,900 to pay it off in 2016.

yahoo pound chart

The falling pound had created an extra $1,300 profit.

Do the math: 

Silver worth $20,421

Loan payoff  $13,900

Profit             $6,521

Cash Required  Zero

All of this profit was made on the 10,000 pound loan.  No extra cash was required.

Again this was pure… extra profit.

Some investors borrowed less… others borrowed much more so their profits were even higher.

All the extra earnings were derived from a low cost, easy to obtain loan that almost any investor can have.

I would like to help you learn how to tap into this type of profit that most investors will miss… in my newest report “The Silver Dip 2019”.

First let me answer a really important question…  that if you have not asked, you should.

Isn’t there some risk?

Yes.  There is always risk when you invest.

The first golden rule of investing outlined in the Silver Dip 2019 report is…”there is always something we do not know”.

The numbers above are what have happened.   We never know for sure what will happen.

2015 was similar to 1986.  Investors were afraid of silver.  Courage was required and this is exactly why dip investments work so well.

When most investors are afraid of a precious metal, extra good value is created!

Plus there is a way to dramatically increase the odds that your investment will be safe and that you’ll reap the type of high rewards I have described above.

The formula for increasing safety and improving the odds for profit are included in the new report, “Silver Dip 2019”.

The benefit of 50 years experience.

With so many years of experience in watching markets, metals, bonds, interest rates and currencies, I have learned many special pricing situations to watch for.

These special opportunities do not appear every day.  That’s why they are special.

Unless you have seen them come and go, it’s hard to see them coming again.

That is why I was willing to wait for years for silver to be in a special pricing position.

Our courses and reports are about finding good value and they have been helping astute readers find value investments, again and again for 50 years.

The “Silver Dip 2019” report shows a new, even bigger opportunity.  I continuously watch for aberrations in currency and precious metal markets.   Sometimes a rare quirk, such as we saw with the pound loans and the Silver Dip offer potential for profit, with very little risk of long term loss.

Investors who speculate on platinum at the correct time can make fortunes.

The time is now.

Success is almost guaranteed.  In fact an 89 year study showed a 99% change of success when sequence distortions are worked in a certain way.

We are stalking precious metal opportunity now.

The trap is set. We are waiting…

This opportunity is explained in the report “Silver Dip 2019”.

You can order the Silver Dip 2019 here for $39.95

Here is why there is no risk for you.  The report is 100% guaranteed.

I do not sell book, reports and courses.  I offer benefits.  If  the Silver Dip 2019 does not bring you the benefits you expect, just let me know within 60 days and I’ll send you a quick, no questions asked, full refund.

I can’t promise that silver’s price will rise in the next 60 days.  I can guarantee you’ll be fully satisfied with the report or… you can have your money back in full.

You can order the Silver Dip 2019 here for $39.95

Gary

 

(1) conservationbytes.com

(2) finance.yahoo.com/dollar index chart

Water Investment Opportunity


As the world grows more complex the simplest investments can be the best.

Not much can be simpler than food, shelter and water.  This is why our sites have long looked at the benefits of investing in water and why at the International Club Retreat we’ll look at the potential available in owning a North Carolina spring water company.

waterScreen Shot 2016-07-25 at 6.55.58 AM

Image from circleofblue.org article “Price of Water 2015: Up 6 Percent in 30 Major U.S. Cities; 41 Percent Rise Since 2010” (1).

When Merri and I began looking for land with two goals, having an altitude (to avoid air conditioning in summer and mosquitoes anytime) and having an abundance of water. We certainly attained both at Merrily Farms.

Owning water makes sense.  We, humanity, are too many.  We are too dirty. Our water is too little.

One way is to own land with water. That’s why Merri and I decided to go to the source and buy land with natural springs .

Each of our houses on the farm has its own gravity fed water supply from one of four separate springs. There are dozens of other springs on the land plus three rushing creeks.

This is one way we invest in water. But where else can we invest?  This is a tricky question for me as I lack experience in the water industry.

However, I recently came across a North Carolina spring water company for sale.  The owner will be at our upcoming retreat this August so we can look at the potential of this opportunity.

Here are a few other thoughts. Look at any industry that deals in water filtering or purification. Companies that build desalination plants would make sense and of course the bottlers of water.

There are numerous problems in the world’s water supply that create opportunity.  One problem is pollution in the water.  Another is not enough fresh water for drinking, cleaning and irrigation.  Another problem is not enough of the right types of water in the right place.

Each of us has a unique perspective that can help us spot unique situations take almonds as an example.  Almonds require enormous amounts of irrigation.  This has caused the price of almonds to rise.  Someone in the food industry might notice an alternative to almonds.  That would be a unique way to spot an opportunity ultimately created by the rising costs of water.

To invest in water was good advice when we began writing about water investments more than a decade ago.  To invest in water is even better advice now.

Much of America’s water infrastructure was built after WW II.  That system, thousands of miles of distribution pipes beneath city streets, the lengthy water transport and treatment infrastructure are now cracked or brittle.  It is time to rebuild and the price will not be cheap.  The economic of treatment, pumping, and supply is rising far faster than inflation.  The average monthly cost of water for a family using 100 gallons per person per day rose six percent last year compared to a 1.8% rise in the Consumer Price Index including food and energy which fell by 0.1 percent.

“We expect water rates to continue to grow above inflation for some time. We don’t see an end in sight.”  –Andrew Ward, Director of U.S. Public Finance Fitch Ratings.

Merri and I have invested in water in numerous ways.

First, we have purchased land with water in Smalltown USA and Ecuador.

Good water was a main prerequisite when we searched for our Smalltown USA farm.

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Little Horse Creek on our farm.

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Mossy Creek on our farm.

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A sacred spring called the Indian Trough is a historical site on our farm and along with dozens of other springs  is our source of water… for drinking.

Merrily farms water

Water flowing from the sacred Indian Trough Spring.

The spring feeds our deep woods, Ofuru, our pond and helps fill the creek.

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Merrily Farms Ofuru… we soak at 107 degrees.

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Our pond at Merrily Farms.

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Our home in Lake County, Florida is surrounded by water.

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This is our Florida back yard.

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Ecuador shaman at one of the numerous water falls at our Ecuadorian Hacienda, Rosaspamba.

In a world where very few things seem transparent, one fact is clear.  If you heed the mathematics of good value, investing in water, especially clear water is a no-brainer in the long term.

I consider the opportunity of owning a spring  water company unique and look forward to learning about it at our International Club Retreat this August 12, 13, 14.  Hope you will join us.

Gary

(1) www.circleofblue.org Price of Water Up

The Essence of Real Security

How to Have Peace & Profit

There are still ways to reduce stress.

Prolonged exposure to stress is the # 1 root of death and disease in our modern world.

Stress can ruin your health and wealth… in many ways.

Daily stress has been magnified because we no control, no way out of the current global political and economic mess.  The news makes current problems feel like things are getting worse.

This downwards spiral leads to health problems, heart disease, hypertension, impaired immune function, infertility, and mental illness.

The health problems lead to economic problems from loss of income, poor investment decisions and high disease management costs.

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farm

Yet there is a way back.

I was reminded of this once when I made a horrible mistake.

The supposed error?  Letting my mind wander six decades back to an hour I spent with a girl.

Learn from this near disaster, seven most powerful sources of wealth, health, security and fulfillment in this era.

The girl was pretty and blond.  Terry was her name. My imagination spanned decades returning to my Oregon roots seeing her as if she were there.

We were 11 or 12 and had known each other since we started Rockwood grade school.  Just buddies, our non-romantic friendship lasted 12 years, from first grade till high school’s end.  Then she went off to Pepperdine College in California.  I started traveling the world.  Never saw her again.  I hope her life has gone well.  But until that reflection I’d never thought much of Terry in so many years.

What could have been the tragic error was letting that memory touch my heart.  Two kids, walking on a crisp, Pacific Northwest autumnal afternoon.

We walked down a sun filled, pine needle covered, dirt path.  Huge, fat, green Douglas firs lined the road.  Traffic was no problem, not many cars.  Crossing Stark Street we turned left, hiking three blocks to 182nd.  There we passed an old clapboard candy store.  I can still hear the wooden sidewalk of that store slap beneath my feet, felt the soggy planks sag and smelled astringent pitch from the fir trees.  Then we turned right, up 182nd for about a mile.  There was Terry’s house.

I carried on, walking through a big field, waist high grass turned straw brown by an early frost.  There were dozens of paths made by who knows what.  Animals perhaps or countless generations of other kids walking home alone from school.  I chose one following it to another wood of tall, rough-barked fir.  Crossing one more field, I climbed a rock wall, struggled through a barbed wire fence (my Mom hated that fence ripping my jeans).  I was home!

Sweet simplicity, that dream.  Two kids holding hands, walking on a dirt trail under a crisp, but blue, sunny sky.  Pure innocence.

My tragic error was looking back.  I returned to Rockwood, Oregon with Merri and my kids to show them this part of their roots.  Following the route, Terry and I had walked were the candy store, grange hall, old wooden buildings and their home spun honesty and charm.

Instead we found six lanes of fast, frantic traffic and road rage.  McDonalds, KFC, strip shopping centers.  The car radio blared warnings of local gangs and drive-by-shootings.

Beauty, innocence, sweet simplicity, replaced by drive ins and drive bys.  Gangs and drive-by shootings replacing a tender walk in the sun.

Good bye memories, good bye.

How can our kids walk in places like this?  How can we return to those old feeling of security and comfort?

How can any of us possibly keep pace in this world that’s moving so fast?

Then something inside snapped.

“There has to be an answer for honest, hard working folks to enjoy the wonderful opportunities of today and regain what we’ve lost over the past forty years”, I swore to myself.

How can we keep up, without having such a fast paced life we turn into machines?  Where do we find time for God, family, charity, and our friends?  How can we rediscover those sun filled, pine needle covered, dirt paths we want to walk?

“There has to be places that are still innocent and pure”, I thought.  “There has to be a way of life that does not pound us with stress”.

This thinking led me to begin reviewing the thousands of economic and business experiences I have shared with readers over the decades.

This started a search for a simpler way of life and a better place to earn and protect our wealth.

By digging, asking and observing, traveling and talking to investors and investment managers all over the world I found that there are true paths to real security in the here and now.  That knowledge helped me develop courses on how to have natural health, everlasting wealth and purposeful investments.

This knowledge helped Merri and me invest in stocks and real estate all over the world.  It helped us find and develop our farms in North Carolina and Florida into sanctuaries.

That almost error led us to create an entire portfolio of information on how to keep pace, get ahead, enjoy our modern society but, to enjoy life wherever you choose without having to move too fast.

This is why I am making a special “Let’s get our lives back” offer.

“What would you think in the last 30 seconds of your life if you were the richest man in the world but were unhappy?”

This quote is from the opening slide of our Value Investing Seminar, “How to Secure Your Future With a Value Breakout Plan”.   This a vital question because few investors think about the value of comfort and happiness.  Yet the truth is, those who are comfortable and happy with their investments are most likely to succeed financially.

Without comfort, no matter how much money a person has, they are more likely to lose it or kill themselves with stress from worry.

There is a way to have the perfect form of financial security.

Let’s call it the perfect pension.  To help understand how to build an unshakable economic platform, here is Part One of the report, The Pruppie Factor.

The Pruppie Factor – Seven Steps to Comfortable Living & Profits.

“May you live in interesting times”.  That’s a Chinese curse that seems to have been cast on our modern world.  We can enjoy comfort and profits in the year ahead despite this fact.

Become a Pruppie.  Integrate your earning with your investing and enjoy peak living, everlasting wealth and natural health with PIEC Investing in the year ahead.

Before we look at what PIEC means, let’s delve into Pruppieism, the new economic and social realism.  Pruppies expect everything to expand.  They take advantage of every new benefit and technology they can.  Pruppies enjoy using the fruits of our ancestor’s deliberations and labors to earn in this advanced technological world.  They also engage in activity that they love that would sustain them in case society and the incredibly intricate weave of our global economy and society should fail.

Pruppies are prepared in case everything, everywhere, or at least everything relating to their income and savings fails and the fabric that surrounds their lives disintegrates into an unknown veil.  Yet a Pruppie’s preparation is not a sacrifice, but a joy as you will see.

Hope springs eternal and it should.  One of the key themes in my first book, Passport to International Profit, (published in the 1970s) was “The Sun Always Shines Somewhere”.  This thought has been in and remains a foundation of everything I do.

Sometimes this sunshine is hard to see because the press always focuses on doom and gloom.  Current news often makes the world seem about to end.  We cannot blame the press. Bad news sells.  The majority seem to want to worry instead of learn about all that’s good.  This does not make doom and gloom right.  This is why the majority are also the rich portion of the population, but bad news is an economic fact for the press.

Yet despite all the negative headlines, we have lived through the Cold War and MAD, Y2K, GridX II, the Peak Oil Crisis, the recession of the 1970s, 1980s 2007, etc. etc. etc.  Chicken Little is always out there, selling the falling sky.  Don’t buy into this story!

History suggests that there will always be opportunity.  The sun always shines somewhere.

Brexit, global warming and the American political process are examples of how the press gravitates to negative news.   The press  make anything and just about everything seem negative.  This can blind us to the positive realities ahead, if we let it.

Don’t.

Expect that the world will remain standing and look for opportunity instead!

Our wealth and economic opportunity is pushed by supply and demand.  We are part of a growing global population.  New technology makes more people, as a whole, more productive every day.  The world has increasingly larger markets creating more supply in increasingly efficient ways.

This reality increases everyone’s wealth.  Yes there is a lot of bad news in many places.  There is inequality.  There is crime.  There is war and hate and injustice.   Despite these negatives there is even more that is positive.  Opportunity grows.

Pruppies tap into and use every bit of the good news they can.  They have a plan B if everything goes wrong, but Plan B is based on something a Pruppie wants to do we love, not just a shelter from bad news.

At the end of this report, you’ll find a special offer that can help you integrate earning and investing for the ultimate form of profit and safety.

Imagine this example of Pruppism.  The Tiffany lamp casts an amber glow, rich, ivory and warm in the grey gloom of early dusk.  The gold knobbed mahogany desk, its deep patina waxed and smooth, shines with reflections of ancient leather Chesterfields stuffed full, but rumpled with age and of maritime shots that hang in brass frames on the wall. The room speaks of settled tradition, the kind that might never end.  But thoughts instead are on the demise of the business that has supported this room.

The late Jim Slater of Slater Walker, a British industrial conglomerate turned bank in the 1970s was in that room.  I recall his bank’s collapse well as I was living in Hong Kong and Slater Walker was a huge going concern in what was a British colony in those days.  The Slater Walker crash was big news that unsettled the entire British banking system at the time.

Slater, the founder, had been a really high roller, using every modern banking tactic available including buying many assets with cheap loans.  Then in the mid 1970s banking crisis interest rates skyrocketed and his bank was unable to refinance its debt.  The company failed and Slater had to resign.  Numerous charges were brought against him and he spent considerable time defending what he had done.

In the end he was only fined a nominal sum but despite this, his banking career was well and truly dead.

However he had already moved on.

He wrote about this in his autobiography, “Return To Go”.  He had always had a hobby making puppet shows and telling stories to his children, so instead of banking, he turned his passion into profit and wrote some children’s books.  His first effort sold a respectable 35,000 copies.  His next a monster series for younger children, became a huge hit.

He had also maintained a hobby of salmon fishing so again turned his passion into profit by creating a business that bought up fishing rights and resold them as time-shares.  He had quite a success.

Some day a catastrophe beyond our control could redirect the course of our lives.  We might lose a job, learn that our pension won’t pay or that our dollars won’t buy as much as they must.

Though Jim Slater was a banker, outside economic forces beyond his control caused his business disaster.  Yet he had options because he had been doing things he loved that were not related to his banking, but could become useful income generators in difficult time.

I do not know if Slater understood Pruppism but that’s what he was practicing.

Pruppism is a positive realism based on the knowledge that much of our lives are directed by events that we do not know or expect and could not change them even if we did.  There is always something we do not know and that’s okay.

Years ago I was speaking at an investing seminar in Marbella Spain.  One of the speakers was a brilliant strategist, Johan Peter Paludan, of the Copenhagen Institute for Futures Studies.  This institute has a large interdisciplinary staff with expertise in economics, political science, ethnography, psychology, engineering, PR and sociology.  They identify and analyze global trends that influence the future.  Paludan was speaking of these trends and answering questions that delegates had about the world’s economic future.

One delegate asked what to do if there was a global nuclear exchange.  Paludan replied that the results of some events are so unpredictable that it is not worth trying to plan for them.

This thought has stuck with me for decades because it helped me realize that no matter how cautious, how defensive and careful we are, there are events that we cannot even imagine that can turn our lives upside down, for the good or bad.  With this in mind my wife Merri and I have created a lifestyle where we turn our passions into profit but in a way that whatever happens we are likely to be in a position to spot the positive and the opportunity.

A PIEC Experience

Pruppies gain the benefits of PIEC wealth.  PIEC is an acronym for “Personal Income Earning Corridor”.  PIEC income and wealth come from doing what you do for love, rather than just the money.

Traditionally people get jobs to create income.  They work to live and support their lifestyle while attempting to spend less than they earn.  They hope, that maybe the savings will bring, sometime in the future, a lifestyle of doing something enjoyable without work.

Pruppies reverse the priorities.  Instead of working for money to save and invest, they focus their prime effort on doing something they enjoy right now.  Then they learn how to enjoy the effort in some profitable way.  They learn to create “Avenues of Abundance” that combine lifestyle with the necessary task of accumulating wealth.

If economic circumstances tie them to an existing income effort, they create hobbies that are income producers of the future.

For example, if a Pruppie loves golf; instead of working six days a week, 50 weeks a year just to golf on Sundays and during short vacations, instead he or she will create a business in some aspect of the golfing trade.

In another example, a client of mine, who loved animals became a vet.  But he learned that the vet’s lifestyle was not one he enjoyed.  He wanted to travel and move around, which is difficult for a professional who needs to stay at his office and build a practice.  So he built a business that prepares special animal foods for race horses.  Now he travels globally visiting horse breeders and makes much more money as well.

Pruppies combine money with time, energy and desires.  They generate income doing something desired.  Desire and fulfillment become at least as, if not more, important as the money.

#1: Do What You Love!

The reason PIECs work well is that when we love to do something, we do it better, for longer and with greater enthusiasm.

Effort, determination and tenacity are wealth building attributes that cannot fail.  Yet Pruppism does not mean we should suddenly abandon our jobs and try becoming golf pros, when we have never been able to break 100.  Smart Pruppies start small and gradually expand into their passion.

For example, as a writer and lecturer, I was never fully satisfied sitting behind a desk or standing on a podium all day long, even though I was making over a million bucks a year. I’m the physical, outdoors type and yearned for exercise and the wilds of the deep woods. “What good’s the money if this isn’t fun?” I often asked myself.

Rather than quit writing and teaching, I looked for ways to combine these professions with the outdoor life.  Through research I learned that many city folk like myself yearn to be in the primitive outdoors.  So I bought an isolated farm high in the Blue Ridge Mountains and an Andean plantation high in Ecuador where I developed seminar centers with charming but simple dwellings, set in rustic surroundings, with clean water and pure air.  Now I live in nature so after I finish the writing or talking, I can walk in the woods or take my axe and chop firewood or something physical.  I’ve combined my writing with physical work and have blended the life I want, with my readers’ needs in a way that makes great financial sense.

We built a series of cabins in the wild that bring more profits than most stocks or bonds could ever return.

The process took six years to shift. Now we have been at this for nearly two decades and we are far from finished.  But while doing what we love, who cares? This is one of the great benefits of PIEC investing. We can slow down and enjoy the work instead of always rushing ahead, looking for something more.

Those who work nine to five can start PIEC businesses part time if they are too uneasy to quit their jobs. Others, who like myself, already have a business can slowly shift their product or service in a sensible way and let it evolve toward their PIEC.

But where do we start?

There is a seven step process we can all use whether we have our own careers, a business or even if we are retired (PIEC investing is especially good for retired folks who have found the supposed good life flat or financially short).

The first step is to get a clear idea or vision of our dream.  This is sometimes harder to achieve than it seems.  We are so deluged with false ideals from Washington, Wall Street, Madison Avenue, etc. that we have to stop and really take stock.  What do we sincerely want?

There is a very practical economic reason to look inwards for wealth.  Warren Buffet recommends that we only invest in what we understand. What can we understand better than ourselves?

This inner search will lead us to an ideal that begins the second step which is gaining enthusiasm.  How can we be anything but enthusiastic about finally fulfilling our deepest dreams?  The enthusiasm leads to the third step; gaining an education.

We need to find out everything we can about our idea.  To succeed we must take the third step and become real experts in the product or service we offer.

Fourth, this educational process allows us to develop an intelligent, focused business plan we can act upon and the action is the fifth step which brings us the experience. Experience gives us the sixth step, a financial loss or profit.  We always profit in increased knowledge which creates the seventh step, more ideas.

Then the entire cycle starts all over again: Idea, Enthusiasm, Education, Action, Experience, Financial Profit and New Ideas.

This is a way to keep adding new opportunities into our lives.  Business is rarely static. It is an ever evolving process instead.

This seven step cycle may take days, weeks, months or years, but the moment you begin you’ll start moving into an avenue of affluence where you love your work so though money isn’t your main goal it comes more easily.

#2: Do what you love, but also be of service.  Do something for others that is meaningful and important to you.

We all have a purpose in life and when we are filling it, we feel fulfilled.  Wealth and fulfillment is the goal.  Fulfillment is important because of the law of diminishing returns.  A 2008 study that analyzed Gallup surveys of 450,000 Americans suggested that day-to-day contentment improves until income hits around $75,000 per annum.  After that, more money just brings more stuff, with far less gain in happiness.  Income beyond $75,000 does not do much for a person’s daily mood.

This is a pretty general study and regional differences in costs, inflation and life circumstances will create many fluctuations from this norm, but the point is when money is the main goal, the better you get, the harder it will be to gain satisfaction.

Giving, on the other hand, never has limitations, especially when the giving helps complete a purpose that is part of our destiny.

This is true in business and investing.  A study of investors for example found that investors with socially responsible ideals gained the best returns.  A dual goal of profit and achieving some social benefit provides a purpose beyond returns.  This brings comfort and determination to the investments and the added stick-to-it-ness helps increase profits.

The study helped define three aspects of investing that are generally ignored, purpose and habits.

Purpose.  Purpose requires some soul-searching questions about what we each want our life to be.  This purpose is more important than the investment goal.  The purpose of the money we have becomes more important than the amount in the portfolio.

Habits.  Habits come next because we need to create habits and routines that keep us on the path of our unique purpose.  The marketplace does all it can to distract us from our goals.  There is an endless stream of news, rumor, conjecture, facts figures, ideas and tactics generated by every part of every stock market aimed at getting us to act in ways that benefit the agenda of others.

Good habits help us avoid being distracted from what we are meant and want to do.  Good habits muffle the noise of Madison Avenue, the spin from Washington DC and the hidden agendas of big business.  These are among the most powerful ways to increase wealth.  Having greater fulfillment as well as more wealth is a bonus that Pruppies call “Everlasting Wealth”.

#3: Integrate your earning and investing. 

Long term success in business and investing are determined by control and comfort.

Comfort comes from feeling in control, but since there is always something we do not know, real comfort comes from knowing that we are serving a valuable purpose, the best we can, regardless of how events unfold.

Real comfort helps maintain determination, dedication and enthusiasm, all among the most vital parts in the process of succeeding in investing and business.

Our own business increases comfort because a business is simply an investment that gives us more control due to the addition of our own time and energy. 

A Personal Income Earning Corridor (PIEC) begin with a main income generator that we control.  For some this is a job with a salary.  For others it is a pension. For many it is their own business using the concepts of SNAP (Small Niche Area Publishing).

Here’s why self publishing offers such great potential.

Sam Walton… or is it Warren Buffet?  Self publishing is based on three cherished beliefs that two of the wealthiest people in the world, Sam Walton and Warren Buffet, shared.

Buffet and Walton shared several cherished business beliefs that you can gain from a special writing and publishing business that is at its very beginning stage.

Cherished Belief #1:  Small is Beautiful.  Both Sam Walton (Bentonville, Arkansas) and Warren Buffet (Omaha, Nebraska) chose America’s heartland away from the big cities as their homes.  What’s more, Walton chose to do business in these small places as well… building the largest retail operation in the world almost entirely in small towns.

Warren Buffet believes that potential in small towns offers special value.  He believes this so strongly that he has been buying newspapers in small towns.

Over the last few years Berkshire Hathaway purchased 63 small and mid-sized daily and weekly newspapers throughout the United States.

He plans to buy more and says: “I like buying individual papers at the right prices.” 

Buffet stated that Berkshire is not buying big newspapers or more newspaper shares. He is sticking with small publications because he believes in the value of local communities.

Cherished Belief #2:  Community Orientation.

Buffet is not buying big publications but is grabbing up small community focused publications.

His bet is that publications focused on local communities can withstand the shift of readers and advertisers to the Internet.

The individual papers can be really small as 10,000 circulation with tiny staffs.

He said no one has stopped reading “half-way through a story that was about them or their neighbors.”

He also noted, “Berkshire buys for keeps. I’d rather buy newspapers myself directly,” and is seeking papers that publish in cities and towns with a “Sense of  Community.”

From this vision WalMart remains committed not just to expanding the businesses but to improving the communities.

You can enjoy all these benefits through Self publishingbecause small communities can be places, ideas or ideas within places.

The factors that makes publications like this successful are its common interests.  Common interest can be focused on a geographical area or a niche idea that targets a niche of a larger market.  For example, the market for truckers is quite large, but trackers that look after their health is a much smaller niche.  One benefit of SNAP publishing is it surrounds you with people who have a common interest, so your readers are like-minded souls.

Cherished Belief #3:  Seek Good Value.

Sam Walton built one of the largest fortunes in the world… with the simple goals of providing great value and great customer service.  Warren Buffett’s belief is that the essence of value investing is buying stocks at less than their intrinsic value.  The discount is called the “Margin of Safety”.

Both Buffet and Walton shared a vision that small towns ignored by the mainstream offered good value.  You can tap into extra profit potential as a SNAP publisher who helps a small community.

Knowing BOTH successful niche magazine publishers and internet marketing geniuses is important for a reason that Buffet outlined to his publishers when he purchased their papers.  Buffet believes that small newspapers will change and that they serve an important purpose.  He said, “Papers must rethink the industry’s initial response to the Internet as focus on continuing to maintain a strong sense of community“.

His bet is that publications focused on local communities can withstand the shift of readers and advertisers to the Internet.  Buffet has said that giving news away free online is “unsustainable” and has sought papers that publish in cities and towns with a “sense of community.

We have never seen this need for a sense of community as we do know because community creates trust.  As the world has expanded on big is better, the public has lost trust.  We no longer trust big business, big government, big hospitals, big banks, etc.  Yet publications offer nothing if they do not have the reader’s trust.  Internet publishing on the big scale has reduced trust.  Anyone can say anything on the internet and thus internet information is highly suspect.  Publishers who use a small niche to create trust have an advantage.

To begin this introduction let me add one more point and outline the value of what I am about to offer.  A SNAP publication may eventually require $5,000, $10,000 or even $15,000 in start up costs but can make up to $11,835 a month… or more.  That’s value… plain and simple.

Join The International Club for all of 2018 NOW.  Learn how to wrote and publish.  Save $418.78.

Club members start by receiving seven workshops and courses on how to earn everywhere with home micro businesses.  We call this our “Live Well and Free Anywhere Program”.   The program contains a series of courses and reports that show ways to earn and be free. These courses and reports are:

  • The course “Self Fulfilled – How to Write to Self Publish”
  • The course “Event-Full – How to Earn Conducting Seminars and Tours”
  • The course “International Business Made EZ”
  • Video Workshop by our webmaster David Cross
  • The entire weekend “Writer’s Camp” in MP3
  • The report “How to Raise Money Abroad”
  • Report and MP3 Workshop “How to Gain Added Success With Relaxed Concentration”

Club members also learn ways to be be healthier and have more energy.   I have created three natural health reports about:

#1: Nutrition

#2: Purification

#3: Exercise

Recent news about Social Security, pensions and health care shows that the US government has excessive debt today and that we as individuals need tactics to make sure, when governments, pensions and insurers weasel out of their promises, that we can take care of ourselves.

One big broken promise is Social Security and Medicare.  The most recent Social Security trustee report shows that the programs will begin to spend more than they earn within just three or four years.   The Medicare hospital-insurance trust fund, could use all its reserves by 2028.  They face insolvency over the next 20 years because Social Security runs totally out of money by 2034.

My three natural health reports help learn ways to be happier, healthier and avoid much of the Western disease management (aka healthcare) expense.

Each report is available for $19.95.  However you’ll receive all three FREE as club member and save $59.85.

Next, club members participate in an intensive program called the Purposeful Investing Course (Pi).  The purpose of Pi is finding value investments that increase safety and profit.  Learn Slow, Worry Free, Good Value Investing.

Stress, worry and fear are three of an investor’s worst enemies.  These destroyers of wealth can create a Behavior Gap, that causes investors to underperform in any market good or bad. The behavior gap is created by natural human responses to fear.  Pi helps create profitable strategies that avoid losses from this gap.

Lessons from Pi are based on the creation and management of numerous Model Portfolios, called Pifolio.

We combine the research of several brilliant mathematicians and money managers with my years of investing experience.

There are no secrets about this portfolio except that these mathematicians ignore the stories from economic news (often created by someone with vested interests) and is based mainly on good math that reveals the truth through financial news.

The Pifolio is a theoretical portfolio of MSCI Country Benchmark Index ETFs that cover all the good value markets using my 50 years of global experience and my study of the analysis of four mathematical investing geniuses (and friends).

This is a complete and continual study of what to do about the movement of international major and emerging stock markets.  I want to share this study throughout the next year with you.

This analysis forms the basis of a Good Value Stock Market Strategy.  The analysis is rational, mathematical and does not worry about short term ups and downs.  This strategy is easy for anyone to follow and use.  Pi reveals the best value markets and provides contacts to managers and analysts and Country Index ETFs so almost anyone can create and follow their own strategy.

The costs are low and this type of ETF is one of the hardest for institutions to cheat.  Expense ratios for most ETFs are lower than those of the average mutual fund.  Little knowledge, time, management or guesswork are required.  The investment is simply a diversified portfolio of good value indices.  Investments in an index are like investments in all the shares of a good value market.

Pi opens insights to numerous long term cycles that most investors miss because they have not been investing long enough to see them.

The Pi subscription is normally $299 per annum but as a club member you receive Pi at no charge and save an additional $299.

There are two more reports I’ll send about the most exciting opportunities I have seen since we started sending our reports on international investing ideas more than three decades ago.  The trends are so clear that I created a short, but powerful report “Three Currency Patterns for 50% Profits or More.”   This report shows how to earn an extra 50% from currency shifts with even small investments.  I kept the report short and simple, but included links to 153 pages of  Good Value Stock Market research and Asset Allocation Analysis.

The report shows 20 good value investments and a really powerful tactic that shows the most effective and least expensive way to accumulate these bargains in large or even very small amounts (less than $5,000).  There is extra profit potential of at least 50% so the report is worth a lot.

This report sells for $29.95 but when you become an International Club member you’ll receive the report, “Three Currency Patterns For 50% Profits or More” FREE.

Plus get the $39.99 report, “The Silver Dip 2019” free.

With investors watching global stock markets bounce up and down, many missed two really important profit generating events over the past two years.  The price of silver dipped below $14 an ounce as did shares of the iShares Silver ETF (SLV).   The second event is that the silver gold ratio hit 80 and has remained near this level, compared to a range of the 230s only two years ago.

These two events are a strong sign to invest in precious metals.

I prepared a special report “Silver Dip 2019” updated in late 2018.   The report explained the exact conditions you need to make leveraged silver & gold speculations that can increase the returns in a safe portfolio by as much as eight times.  The purpose of the report is to share long term lessons about speculating in precious metals gained through 30 years of speculating and investing in gold and silver.

The price of silver may offer special value later in 2019, but the price of platinum is special now.   So I want to send you the report “Platinum Dip 2019”.

Save $418.78… when you become a club member.

Join the International Club and receive:

#1: The $299 “Live Well and Free Anywhere Program including SNAP”.  Free.

#2: The $299 Purposeful investing Course (Pi).   Free.

#3: The $29.95 report “Three Currency Patterns For 50% Profits or More”.  Free.

#4: The $39.99 report “Silver Dip 2019”.  Free

#5: The three $19.99 reports “Shamanic Natural Health”.   All three free.

#6: The $39.99 “Live Anywhere – Earn Everywhere” report.  Free.

#7: Plus updates and other report I release in the year ahead.

These reports, courses and programs would cost $767.78 so the 2018 membership saves $418.78.

The International Club membership is $499. 

To encourage our first 100 members for 2018 to join quickly so we are currently accepting discounted membership at $349. 

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Gary

 

 

 

 

 

 

 

 

 

 

 

 

Spring 2014 Multi Currency Investment Value Updates for Subscribers Only


Spring 2014 Multi Currency Investment Value Updates

As a Multi Currency Report subscriber you can now access the 52 page Spring 2014 Keppler Emerging Market Value Analysis Update is available at the password protected Gary Scott club site:

Keppler emerging market value analysis-spring-2014

The 83 page Spring 2014 Keppler Developed Market Value Analysis Update is available at
Keppler developed market value analysis spring-2014

Please send questions or comments to me at Gary@garyascott.com

Gary

Multi Currency Value Investing Seminar

Old Accord Creates New Profits – Multi Currency Investments.

Earn more with multi currency stock market breakouts.

Improve Safety – Increase Profits

Learn how to improve the safety of your savings and investments by selecting good value and diversified investments in a multi-currency portfolio.

Few decisions are as important to your wealth as the value of the markets and currencies you invest in.  This has been our area of expertise since the 1970s and we have worked with and advised some of the largest currency traders in the world.

Gain Protection First – Against the Dollar’s Purchasing Power Loss.  In 1913 the The Federal Reserve Act created the Federal Reserve Bank to protect the purchasing power of the US dollar, which has since lost about 94% of its purchasing power.  Here is its price compared with gold since 1900.

priced in gold

Dollar chart from pricedingold.com (1)

The Fed has let the dollar lose most of its strength plus has allowed interest rates to fall so low, that safe investments cannot keep pace with the drop in purchasing power.

multi-currency-chart

Chart from Grandfather Economic Report (2)

Many investors have forgotten about the risk of a falling dollar because the greenback has been strong for the past five years.  This temporary dollar strength came after the great recession of 2009 just as there was temporary dollar strength after the great recession of the 1980s.  Then about six years after the recession, an agreement was made by major governments to weaken the dollar.

There was a severe global economic recession affecting much of the developed world in the late 1970s and early 1980s.  The United States and Japan exited the recession relatively early, but high unemployment would continue to affect Europe and the UK through to at least 1985.  As a consequence between 1980 and 1985, the US dollar had appreciated by about 50% against the Japanese yen, Deutsche mark, French franc and British pound, the currencies of the next four biggest economies at the time. Then the governments reached an agreement and exchange rate values of the dollar versus the yen declined by 51% from 1985 to 1987.

Now the world is again in the same place.  The recession is over.  Europe is a bit behind in recovery and the dollar is higher than before the recession.

There is no reason for the greenback to be  strong.

The agreement in 1985 was called the Plaza Accord.   Over just two years the greenback dropped nearly 50% versus other major currencies.  The next accord will generate great profits for those who know what to do while it ruins the purchasing power of dollar back investments.

The strong US dollar and low interest rates have created one of the biggest stock and multi currency breakout opportunities in history.  Learn how to create a plan to profit from multi currency shifts ahead.

One reason for the potential gains is that stock markets and currency values are cyclical.  Due to low interest rates created by the 2009 economic downturn, the US and a few other equity markets have risen to some of their highest prices, ever.  These markets offer very poor value now.  The steep valuation creates incredible profit potential but also hides some enormous risks.  Learn how to develop an investing strategy based of earnings, cash flows, dividends and book values to increase potential for profit and reduce the risks.

Next Extra Profit Created by Value Breakouts

Over the history of US equity markets, the  price of overall markets have risen about 9.1 percent, respectively, compounded annually.  Yet over more than a hundred years of stock market activity,  a majority of the profits have come from just a very few dramatic breakouts.

Equity markets are ruled in the short term by emotions that create unpredictable ups and downs.  Numerous fears of defaults, worries of double dip recessions, high unemployment, concerns about fiscal cliffs, hold investors back.  Yet global population growth and advances in production and prosperity are relentless economic fundamentals that increase value.

When fear holds back a a fundamentally rising value, rising profit potential grows.  Values increase as prices stagnate.  Then markets break free and rocket upwards creating wealth, prosperity and growth.

Find out which breakouts are likely to take place next.

Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 years as shown in this graph.

stock-Charts

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns create war.

Here is the war stock cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WWIII) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Learn how the Cyber War (WWIV) may change the way we live and act and how this will affect currencies and investments.

Learn:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios), but his big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on a 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of outperformance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.  This rate of expansion by the way is called the “Golden Ratio”.  It is a mathematical formula that controls the growth of most natural things; trees, the shape of leaves, the spiral of shells, as well as the way economies and societies grow.

We’ll sum the strategy, how to leverage cheap, safe, quality stocks and for what period of time based on your circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 (almost) years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy investing more with slow, worry free, good value investing.  Stress, worry and fear are three of an investor’s worst enemies.  These are major foundations of the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market they choose.  The behavior gap is created by natural human responses to fear.  The losses created by this gap grow when investors trade short term under stress.

Learn how to put meaning into your investing by creating profitable strategies that combine good value investments with unique, personal goals.

Learn how to span the behavior gap.  Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse, when they should embrace risk.  Purpose is the most powerful motivator,  stronger than fear and greed.  One powerful way to overcome the behavior gap is to invest with a purpose.

Combine your needs and capabilities with the secrets and the math of our good value model portfolio.

Share ideas about my good value portfolio.  My personal investment portfolio comes from a continual analysis of international stock markets and a comparison of their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.

Markets included in this portfolio are:

• Norway
• Australia
• Hong Kong
• Japan
• Singapore
• United Kingdom
• Taiwan
• South Korea
• China

These markets have been chosen based on four pillars of valuation.

• Absolute Valuation
• Relative Valuation
• Current versus Historic Valuation
• Current Relative versus Relative Historic Valuation

Learn how to use Country ETFs to easily construct a diversified, risk-controlled, equally weighted representative country portfolios in all of these good value countries.

To achieve this goal my portfolio consists of Country Index ETFs that track an index of shares in a specific country.  These country ETFs provide diversification into a basket of equities in the good value countries.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

This is an easy, simple and effective approach to zeroing in on value because little management and guesswork is required.  You are investing in a diversified portfolio of good value indices.  A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to pick and choose shares.  You can invest in the index which is like investing in all the shares in the index.  All you have to do is invest in an ETF that in turn invests passively in all the shares of the index.

Learn the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed a test.

The Test for Low Cost Trading

Research put every part of this portfolio in place, except knowing the best, easiest and least expensive way to buy.  A search for an optimal way to buy and hold boiled down to two methods.  One tactic to test was to use a unique online broker that appeared to offer the lowest cost deal.  The other approach was to use a community bank in Smalltown USA.  The small town bank that I use looks after my 401K trust account and their service is first class.  The benefit of small banks is that they still treat us as a human beings (instead of a number) and when we need, it’s easy to go right to the top to answer a question or get a problem resolved.  There are no call centers and the bank and the person looking after my account is just around the corner.

I created a test to see which offered the least expensive service.

Working with my banker in Smalltown USA,  I created two accounts, one at the online broker and the other at the bank. I placed $40,000 in each.

I set up the order for the country ETFs online, while my trust manager set up orders for the identical amounts of the same shares in his system.  Then we got on the phone, coordinated our timing and on a count of three each pushed the button “BUY”.

The results of this test  show how you can gain on any purchase of country ETFs.

In this special offer, you can get this online seminar FREE when you subscribe to our Personal investing Course.

Save $468.90 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip 2017” and our latest $297 online seminar for a total savings of $468.90.

ecuador-seminar

Triple Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip 2017” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

Subscribe to a Pi annual subscription for $197 and receive all the above.

Your subscription will be charged $299 a year from now, but you can cancel at any time.

Gary

 

Gary

(1) Dollar chart from pricedingold.com

(2) Grandfather Economic Report

 

Sandalwood Investing Updates


Sandalwood Investing Update on August 20, 2014.

We published our Sandalwood Investing report this last January when shares in the Sandalwood plantation company TFS Corp. (share symbol TFC) were selling at A$1.19. The shares yesterday passed A$2.15.

sandalwood chart

(click on image to enlarge.)

See the updated TFS Corp. share chart here

TFS has announced that a Nestle owned company will buy $500 million worth of sandalwood oil from them.

An ABC.net article entitled “International dermatology company Galderma confirmed as multi million dollar buyer of sandalwood oil” (1) by Tyne McConnon says:  The world’s largest producer of Indian sandalwood says Nestle-owned company Galderma is the multi-million-dollar buyer of its oil.

Tropical Forestry Services (TFS) announced in March it had signed a deal expected to be worth half a billion dollars with a pharmaceutical company.

TFS has plantations in Western Australia, the Northern Territory and Queensland.
The company’s head of global products Mario Di Lallo says Galderma will use the oil in various products.

“Things like eczema creams, warts, acne, actinic keratosis, which are the pre-cancerous skin lesions that people go and get cut off and burnt off.

“Most things that afflict the skin.”

Mr Di Lallo confirms the deal to sell the sandalwood oil for US$4,500 per kilogram for up to 20 years.

See article here International dermatology company Galderma confirmed as multi million dollar buyer of sandalwood oil

Update March 7, 2014 Sandalwood Investing Report Updates. 

tfs share chart

TFS Corp share have risen 284% from June 2013 to June 2014. See the updated TFS Corp. share chart here

This post updates our continual review and research on sandalwood investments that we share with our readers of the Sandalwood Investing Report.

Screen shot 2014-01-28 at 5.28.13 PM

You can order the report at Amazon.com

If you have questions or comments, please write to me at gary@garyascott.com

* This sixth Sandalwood Investing Update on March 7, 2014 shows links to news about the potential for expansion of the market for TFS Corp. sandalwood oil.

The first news at www.kew.org says:  Sandalwood is undergoing clinical trials to investigate any medicinal properties.

Active compounds 

The active ingredients in sandalwood are santalols, which should make up about 90% of the oil. These compounds have anti-bacterial activity and recent research has shown that they might have some use in the treatment of skin cancer.

An Australian Stock Exchange release says Approval to initiate FDA phase 2 study for molluscum contagiosum.

TFS Corporation Limited (“TFS”, ASX: TFC) today announced that its pharmaceutical partner ViroXis has received Institutional Review Board (“IRB”) approval to initiate Federal Drug Administration (“FDA”) phase 2 study for the treatment of molluscum contagiosum (“MCV”) using TFS’s East Indian sandalwood oil (“EISO”).  IRB approval is a prerequisite to initiate clinical studies in the United States for prescription drugs.

MCV is a very prevalent and highly contagious pox virus skin infection for which there are currently no approved prescription treatments.

ViroXis’s CEO Ian Clements said, “This last step in the approval process clears the way for ViroXis toenter clinical trials for our second high value dermatology indication, following our first phase 2 indication with the human papilloma virus (HPV or common warts). This validates our strategy todevelop a portfolio of TFS EISO – based topical anti – viral prescription products.”

Frank Wilson, CEO of TFS, said. “This is another important milestone in the development of a global market for TFS’s pharmaceutical grade EISO in the dermatology sector.

It builds on the exclusive supply agreement with a leading global dermatology company (announced on 26 February 2014) for over the counter dermatology products, which are expected to launch in the United States later this year.

We are excited by the prospect of TFS EISO becoming a core ingredient in a suite of over the counter and prescription dermatology products with a strong pipeline of new products being developed with our pharmaceutical partners ViroXis and Santalis.”

An article at www.businesswire.com says about San Antonio Private Company Santalis Pharmaceuticals Inc: Santalis Pharmaceuticals Signs Exclusive License Agreement with Global Pharmaceutical Company to Commercialize OTC Dermatology Products.

Santalis Pharmaceuticals Inc., a joint venture with TFS Corporation Ltd., of Australia (ASX: TFC) is pleased to report the execution of an exclusive license agreement with a global pharmaceutical company for the marketing of a number of over-the-counter (OTC) dermatology products containing TFS’ sustainably cultivated, pharmaceutical-grade East Indian Sandalwood Oil (EISO).

The pharmaceutical partner is exclusively dedicated to dermatology and is a world leader in dermatology products with an extensive product portfolio available in 80 countries. The long-term license agreement provides for upfront and milestone payments and royalties based on product sales. The license agreement anticipates worldwide commercialization of the OTC products, with an initial product launch in the U.S. anticipated at the end of 2014.

In addition to its OTC products, Santalis is developing a range of prescription drug candidates. The company’s first prescription drug candidate, a topical formulation of EISO to treat pediatric eczema, is expected to enter the clinic in the US in early 2015.

See more TFS Corp. news including a new big investor of 67 million dollars in Australian Stock Exchange (ASX) reports .

Regarding the news that TFS corps. 50-50 venture Santalis signed agreement with big phrama company,  I am a little disturbed that I cannot find anywhere who the 50/50 partner is or who the big pharma company is.  See more about this arrangement at au.news.yahoo.com

* This fifth Sandalwood Investing Update on March 7, 2014 shows data that explains why TFS Corp could earn as much as 2.36 billion dollars in the next ten years.

Our Sandalwood Investing Report was published January 26, 2014.  The price of the TFS sandalwood shares we had researched and written about were A$1.19.  Yesterday when I researched this post the share price was A$1.71.

sandal wood share chart

Yesterday’s TFS Corp. share chart from Australian stock exchange.

Click on image to enlarge.

This chart from analysis of TFS Corp. business potential shows that earnings in Australian dollar earnings over the next decade could reach 2.296 billion .

tfs chart

* The fourth Sandalwood Investing Update on February 12, 2014 comes from a middle manager in the forestry business who manages a plantation near the TFS Corp. plantations. 

Using the seven steps away idea,  I began asking family in Australia if they knew anyone in the forestry business.

I was able to connect in only three steps.   #1: Our son in law contacted a friend who has been working in the forestry industry for years.

#2: The friend explained that one of the main drivers for TFS Corp. and other plantation investment companies is tax minimization.  To encourage investment in industries like this, the Australian government runs a scheme that lets investors write off their initial investment as a tax loss, and only taxes them on the profits/dividends they make 10-15 years when the plantations mature.

So it’s a tax wise investment for people in their fifties.  They get the write-off while they are high-earners. Then they take the profits during retirement, when their tax bracket is lower.  Australia did not use to have personal pension plans, so this was an alternative.

He said the main problem with a lot of other plantation investment/tax schemes like this is that they were managed with a focus on finance and marketing, rather than a focus on the technicalities of forestry/production. The underlying quality of the plantations were not very good.

However, he didn’t know if this was the case with TFS.  He said it’s entirely possible that even as an investment scheme, their plantations are technically well-managed.

He thought it was a good sign that they’ve planted Indian sandalwood trees, instead of the lower-value Australian sandalwood trees.

He said that the entire industry has gone through tough times, and a number of timber plantation companies went into liquidation a few years ago.

He said that TFS received a big investment from the Middle East at just the right time to keep it going, which is why it’s probably still quite stable.

He said a former colleague of his was much more familiar with the technical side of the TFS Corp. plantations and left a voicemail message for him while I was there.

I  obtain this friend’s number and called him.  He kindly gave me 30 minutes of his time on the phone and we spoke about the technical side of the forestry business.

This plantation manager operates very near the TFS Corp. plantations and he knows several of the plantation managers who run the TFS Corp. plantations.   He says they are very competent people.

He explained that sandalwood is very hard tree to grow as it is a parasite. The mangers not only have to grow sandalwood but also have to nurture the host tree.

He said sandalwood is a sensitive tree and that pesticides and herbicides cannot be sprayed directly on the tree. The weeds have to be pushed aside by hand so they can be sprayed.  The high labor costs in Australia mean that the sandalwood plantations are very expensive to operate.

He said that the TFS people were disappointed with their first harvest but are continually learning.  An example he gave me was that when they first pruned the sandalwood the trees weeped a lot more oil than they expected.  They learned to prune the trees earlier and this seems to have solved this problem.

He was not aware of Spike disease or any other such problems.   He pointed out that usually trees usually grow better in a country away from their original habitat, in part because native disease is missing.

He felt the company was well managed but that the shares having spiked after the first harvest might drop and that investors would have a better feel of success in six months or so.

This has been good advice as the share price has dropped from A$1.20 to A$1.10 in the first month since the research in this  report month.

finance.yahoo.com.au chart

Click to enlarge.

See updated www.finance.yahoo.com.au TFS chart

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This is work.  Earn numerous streams of secondary income through self publishing.  See three self publishing stories that have made others rich.

* The third Sandalwood Investing Update comes from the Australian analyst who provided the October research.

As mentioned, this is the only analyst we have found who has visited the plantation and issued a report on the shares of TFS Corp.  Due to security regulations in Australia e could not report direct to me so I posed the questions to our bankers who passed the questions onto the analyst.

Our Banker wrote: I have studied your report on TFS Corp and wondered if you have a feel for the integrity of management and the technical expertise following your site visit?  In particular:-

Q:   are there any conflicts of interest you can see in the way that the business is run for both owned and managed woodland?

A:  Yes! This conflict is now coming to a head as CY14 will be the first time the company has harvested and sold a MIS planting.  As you can see from any of the MIS product disclosure statements, TFC is obliged to get the best possible price for MIS investors, but the company also wants to be able to buy the wood for as low a price as possible and then achieve a margin by further processing (converting to oil, beads, etc). It is also interesting to note TFC has the right to match the terms of purchase offered by any third party. I do not know exactly what the company plans, but I would envisage a scenario whereby TFC holds some sort of open tender process, possibly even a live auction at Kununurra, so it can be clearly seen to get the best price possible. Anyhow, even in a ‘worse case’ outcome for TFC where public sale prices are too high for it to make any margin by further processing, this will still be positive in that it will likely encourage new MIS investment and also underpin the value of TFC’s owned plantations

Q: Are there any previous management issues?

A: This is a difficult question in that the company has had to deal with the implosion of the MIS sector and associated negatives regards management credibility. The most notable negative was board turnover during CY12 and shareholder push to replace Frank, etc. See the shareholder notice of 20 Dec 2012 for background. My perspective on management is that Frank Wilson started TFC, has spent +15 years driving it and owns 44m shares (~16%) and so is highly motivated to achieve maximum shareholder value. Regards the issue of board independence, that is now a moot; my somewhat cynical perspective (having been a small-cap specialist for 15 years) is that for a small company the competence of the CEO is everything and a rising share price overcomes any investor qualms (see Rupert Murdoch, Frank Lowy as key examples)!

Q: Are there issues or conflicts relating to the marketing of tax favoured schemes involving hardwood and the management of the business for profit?

A:  The question of tax deductibility of agricultural schemes has been around for decades, and has always been resolved in the industry’s favour. There might be some interesting pushback should any of the principals of Timbercorp or Great Southern be put on trial for their shenanigans, but the industry structure is essentially a settled question.

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Dollar chart from pricedingold.com

Protect against the US dollar’s loss. Invest with the THREE POINT COMMAND POSTURE

* The second sandalwood update comes from  the only analyst we have found who has visited the plantation and issued a report on the shares of TFS Corp. 

The October 2013 report was headed TFS Corp Site visit verifies Indian Sandalwood oil production and gave a Buy recommendation with a target price of .A$.90 cents.  The price was A$.77 cents at the writing of the report.

This report shows that TFS MIS (Managed Investment Scheme) production is below what was reported in the early TFS Product Disclosure Statements (PDS).

In Australia managed investment timber schemes (MIS) are required to produce a Product Disclosure Statement (PDS) showing how the program works and the potential returns, risks, investments, fees, costs, taxes etc.

The report said:

On our forecasts that assume a similar level of new Wholesale, High Net Wealth and MIS (Managed Investment Schemes) sales to FY13, TFC’s current year valuation metrics do not appear inappropriate given the near term uncertainty surrounding the timing of Wholesale settlements.

However over coming years acceleration of commercial harvest proceeds offers a substantial uplift in earnings (potential EBITDA (Earnings before interest, taxes, depreciation and amortization) of + $400m in ten years time vs $51.8m ‘cash’ EBITDA in FY13) that at some time in future will inevitably drive robust share price performance.

Earnings Impact

Forecasts now reflect likely sub-PDS heartwood yields for early plantations
Investment Thesis

■ The complexities of Indian Sandalwood (included its parasitic nature and delay of oil-bearing heartwood formation) have induced a degree of uncertainty as to whether yields would meet targets first set over fifteen years ago; initial data from the first commercial harvest undertaken in September indicates that whilst survival rates and heartwood per tree are lower than originally targeted, oil quality and oil yields meet ISO standards and the targeted 3.7% which provides an important verification.

■    We visited TFC’s operations around Kununurra and seeing for ourselves the proceeds from the first 8ha harvest, what is clear is that the knowledge gained from the earliest plantations has been deployed and has resulted in material improvements in Indian Sandalwood growth; as such whilst yields over a number of years are likely to fall short of PDS targets we see harvests for more recent plantings as likely to considerably exceed heartwood developed per tree.

■    With confidence provided regards heartwood and oil production, the next key uncertainty is sustainable pricing as larger volumes of wood and oil become available; we are of the view that emergence of a sustainable, legal supply (most Indian Sandalwood is poached) will see an increase in demand from pharmaceutical and fine fragrance sectors, with the growing wealth of India and China driving decorative carving, fragrance and religious ceremony needs.

■ Assuming target yields and a flat heartwood price we estimate TFC will generate +$2bn EBITDA solely from the sale of its owned trees over the coming fifteen years (noting that earnings will materialise more so towards the later years), highlighting the ‘embedded value’ of its 2,443ha (hectares – appx. 5,900 acres)  ownership stake.

Whilst yields on the EKS project are likely to prove lower than targeted given survival rates of only ~25% and considerably smaller tree size (and thus heartwood yield) at the 15 year mark, this confirmation of commercial oil yields provides a hefty confidence boost both for near term revenue generation from the harvest as well as heartwood yield prospects of the +7,000ha of plantations currently in place.

We recently (14/15 Oct) visited Kununurra and saw the range of established plantations in addition to the Primary Processing Centre and Seedling Nursery, which provided a pleasing confirmation of the quality of the operation as well as the opportunity to inspect some of the recently harvested and processed Indian Sandalwood logs.

Overall, the conclusion we reach following the tour is that the development and maintenance of Indian Sandalwood plantations has seen substantial changes over the years, with the first few years of plantings somewhat experimental in nature settling down to a more consistent and incremental improvement process.
Indeed, the confirmation of oil from the initial commercial harvest provides a very high degree of confidence in future volume increases, with notable factors as follows:

Heartwood is being generated; it is ‘real’!

A visit to the processing facilities revealed the results of the initial 8 ha of harvesting with the photograph below showing some of the dressed logs; we also saw the bags of shredded heartwood ready to be trucked to the Mt Romance facility in Albany and the extracted tree stumps that will be further processed.

The inspection of plantations by establishment year revealed considerable differences in the spacing and arrangement of both Indian Sandalwood trees as well as host species.

Whilst we are clearly not expert enough to detect subtle differences, what was clearly apparent is that Indian Sandalwood survival rates increased dramatically after the 1999 plantations (that saw an eventual survival rate of ~25%) with little identifiable differences in arrangements from ~2001 plantings onwards; whilst data on survival rates was most recently provided at the 2 Sep 13 presentation (Slide 17) nonetheless it was pleasing to see first-hand.

What is also very clear is that tree growth rates are greater for more recent plantings with the implication being that tree sizes and thus amounts of heartwood and oil will increase over time.

A notable feature of the plantations is that individual trees show considerable variability in size with the biggest tree in any single hectare often having a trunk diameter half as large again as its nearby peers, with this difference attributable to a number of factors including improved host bonding, local soil properties or genetic attributes.

Given it develops its own seedlings (and also plants them already established with a host) TFC has been undertaking a stock selection process whereby seeds are taken from the largest trees (or number of trees depending on planting requirements) and propagated, reinforcing the genetic attributes of the best individuals regards growth rates and size.

Indian Sandalwood trees begin to produce seed after around three years, and so this stock enhancement program has only been through a few cycles which offers considerable scope for ongoing improvements and also longer-term heartwood yields given the expected relationship between tree size and heartwood production.

Production confirmation makes oil price the primary uncertainty

As we now have considerable confidence in future heartwood/oil volumes from established plantations, and indeed argue PDS forecasts for an average 22.5kg heartwood yield/tree are likely to prove conservative in the longer-term, the primary variable for any harvest proceeds calculations is now assessing sustainable pricing as TFC begins to generate commercial scale quantities for global markets.

The dwindling supply of natural Indian Sandalwood has seen a considerable amount of trade on the black market rather than via official traceable channels and product substitution (both different sandalwood species and synthetics) occur, which does present uncertainty as to how inelastic pricing is as sustainable plantation volumes increase.

Whilst mgt indicated TFC recently sold oil for $US4,000/kg representing a ~$US150,000/t price for heartwood we are unsure if this is sustainable as larger quantities are harvested. Nonetheless given the number, size and diversity of major markets discussed below we argue a long-term price of ~$100,000/t for heartwood (implying ~$2,700/kg of oil @ a 3.7% yield) does not appear unreasonable:

TFC the only traceable supplier for pharmaceutical industry

Perfume manufacturers will likely develop new formulations as sustainable supply materialises

MIS Expert Market Report sees +1,100ha of demand as sustainable… supporting ~5% price increases

*    Pharmaceutical: a sustainable traceable supply of oil is vital given the regulatory requirements of the pharmaceutical industry which will provide TFC with considerably pricing power given a likely shrinking legal natural supply. Whist partners Viroxis and Santalis are yet to reach commercialisation stage for any offerings (with the 1 Oct 13 update revealing phase 2 trials are underway for both companies), Viroxis have noted (11 Apr 13) potential annual demand for 240t of oil for its products which would represent ~600ha of plantations each year at PDS yields.

* Carvings: wood has historically been widely used for decorative carvings and utility items, and in addition to India demand from China for larger carvings as status objects is likely to support demand for more sizeable heartwood logs; mgt feedback suggests demand from this sector for larger logs will likely support premium pricing compared to smaller logs valued on an oil content basis.

*    Fine Furniture: although currently the fine furniture market is likely smaller than Carvings in China due to a lack of supply of quality logs, we would expect demand as wood becomes available to provide further impetus to larger log pricing and mgt see potential demand from this sector as potentially greater than for Carvings.

*    Fine Perfume: Indian Sandalwood oil has been an important ingredient in fine fragrances (e.g. Chanel No 5) however we understand the challenge of legal supply has seen synthetic substitution for fragrance and a general avoidance of use as a fixative; should sustainable supplies become available we would expect considerable demand from the industry given the importance of natural ingredients and its superior fixative attributes and with an estimated 100t of oil used by the industry in 1970 (Source: 2013 MIS PDS P69) we would see potential volume sales to this industry being considerably higher.

* Attars: which are non-alcohol based fragrances that are distillates of flowers/herbs/spices over Sandalwood oil; these attars are used for personal fragrance but moreso currently for ‘pan masala’ mouth freshener and given the size of the market being primarily India based we would see potential demand likely to be similar if not greater than the Fine Perfume industry.

*    Cremation: Indian Sandalwood has long been an important additive to a pyre during a Hindu cremation (for example Gandhi’s pyre was all Indian Sandalwood) with the expansion of the middle class in India likely to drive demand.

*    Cosmetics: oil as well as the ‘spent charge’ of chipped heartwood following oil extraction has been used extensively in global cosmetics industries for soaps, face creams, powders and air fresheners both for its fixative value as well as fragrance; PDS commentary estimates 10-15% of total use has been from this sector historically.

Indeed, whilst we argue that current pricing is merely sustainable, the Expert Market Report in the 2013 MIS PDS indicates that demand for Indian Sandalwood could be in the order of 12,000 to 13,000t which represents +1,200ha of demand per year.

TFC has 7,581ha of plantations under management as of 29 Aug 13 of which 1,152ha were only planted during the course of the FY13 financial year (noting total sales were 1,657ha with ~500ha of this to be planted in FY14), so in view of this ‘Expert’ demand estimate there appears little prospect of oversupply.
Indeed, by the time the FY13 plantings are harvested and sold in 2028 the likely demand from an increasingly wealthy India and China will continue to favour demand.

We also note the Expert Market Report sees an annual price increase of at least 5% on the $A111,893/t achieved in Mar 11 for official auctions in India as achievable and sustainable into the near future which would imply a price of +$A230,000/t in fifteen years time.

Ownership of +2,400ha offers substantial ‘embedded’ value

TFC has generated almost all of its earnings from Indian Sandalwood plantation establishment, finance and maintenance fees for both MIS and Wholesale clients, with the Mt Romance EBITDA contribution being <10% of the group’s total, and as shown by the rise and fall of planting activity over the past decade (largely due to MIS regulatory changes) these establishment fees are somewhat volatile and difficult to forecast.

This earnings composition will change over the coming years as commercial scale harvesting commences, with TFC being entitled to a 5% Selling & Marketing fee on gross proceeds of cleaned logs (noting Wholesale investments will only start harvesting in 2026) and it will also be able to generate profits by purchasing cleaned logs from MIS investors and adding value through the Mt Romance processing and marketing operations.

However the most compelling change to TFC’s revenue and earnings over the coming years will be the contribution from its owned assets as mgt have established a holding of 2,443ha from direct plantings, purchasing immature plantations from MIS investors as well as via deferred management fees.

Following our visit we have revised forecast heartwood yield per tree to reflect observed differences in tree size, with 2008 selected as the inflection point for when PDS yields of ~22.5kg may materialise; we also assume a constant price for heartwood of $100,000 per ton.

As shown in the table below we estimate TFC will generate +$2bn EBITDA from the sale of its owned trees over the coming fifteen years, noting earnings will materialise moreso towards later years reflecting the ramp up of plantings and yields since the EKS project in 1999.

Scope for +$3bn of operating profit over next 15 years vs current market cap of $220m.

Market will pay attention to TFC at some point in time.

As such, when combined with harvesting and processing fees for MIS and Wholesale plantations it is not unreasonable to anticipate +$2.5bn EBITDA being generated over the coming fifteen years from all harvesting and sales activities, on top of another ~$750m EBITDA from establishment services if the company can consistently generate +1,000ha of annual new plantation sales.

Stock market will inevitably appreciate ‘embedded value’ given sheer scale of potential profits.

However if we look forward a number of years, say a decade at which point TFC could be generating sustainable EBITDA of ~$400m from harvesting its owned plantations, harvesting and value-adding MIS investors’ harvested wood and also from new establishment fees; in turn this could generate EPS of +80c which if applied to a PER of ~13x (a +25% discount to the current FY14 XSI aggregate) implies a potential ~$10 share price offering robust prospective long-term returns from current levels.

Given the timeframes involved we are a little uncertain as to when the market will appreciate the coming substantial uplift in profitability for the group as the size and quality of commercial harvests increases, nonetheless remain positive on the stock’s performance prospects given scope for EPS acceleration over coming years.

This report was updated by the Australian broker in November 2013 and the share price projection increased to A$1.00

* The first sandalwood update comes from TED, an events business focused on distributing information about “Technology, Entertainment and Design”.  This institution’s has enjoyed enormous success at conducting conferences with “Ideas Worth Spreading”.

The first TED event was in 1984 and included demos of the compact disc. Benoit Mandelbrot talked about how to map coastlines with fractals.  In 2001 The Sapling Foundation acquired TED and opened an audio and video podcast series that put the best TED content online FREE.   By 2009, the number of views at the Ted website had passed 100 million.  Views have now passed one billion.

Ted also publishes case studies and  a Ted Case Study has been done on sandalwood.

Here are excerpts from the Ted Sandalwood Case Study linked above:

The Indian sandalwood tree has become endangered. The tree is government controlled.  Removal is prohibited until the tree is thirty years old.  This has not stopped many poachers from cutting trees down as soon as authorities are not watching.  Smuggling of sandalwood has created socio-economic and law and order problems.

Trade in sandalwood dates back to the beginning of trading in India.  Due to its high value and increased demand in internal and external markets, sandalwood prices have skyrocketed.

Increase in demand can be attributed to the popularity of aromatherapy and trends in the cosmetic industry toward natural
products.

Although trade in Indian sandalwood is officially  restricted, smuggling remains a serious threat to the tree.  The biggest and costliest manhunt in Indian history was launched to track down the leader of India’s major sandalwood smuggling ring, Veerapan.

Approximately 600 Border Security Force troops were used to back up a special police task force which has been combing the
jungles of Tamil Nadu and Karnataka states.

The notorious Veerapan carries a four million rupee ($132,000) bounty on his head and has been on the run from the police since killing his first elephant at the age of fourteen.  He claims to have killed 2,000 elephants for their ivory before entering the more lucrative sandalwood trade.

He has embarked on several killing sprees.  The worst was when 21 members of a police posse were blown up with land mines in an ambush.

Veerapan has become a modern day Robin Hood and is loved by the poor who are either too frightened or too loyal to betray him.

Orders are in the range of millions of dollars, because the wood costs up to 13,700 dollars per kilogram.  A vial of the oil extract costs between 400 and 1,000 dollars.

Multi Currency Value Investing Seminar

Old Accord Creates New Profits – Multi Currency Investments.

Earn more with multi currency stock market breakouts.

Improve Safety – Increase Profits

Learn how to improve the safety of your savings and investments by selecting good value and diversified investments in a multi-currency portfolio.

Few decisions are as important to your wealth as the value of the markets and currencies you invest in.  This has been our area of expertise since the 1970s and we have worked with and advised some of the largest currency traders in the world.

Gain Protection First – Against the Dollar’s Purchasing Power Loss.  In 1913 the The Federal Reserve Act created the Federal Reserve Bank to protect the purchasing power of the US dollar, which has since lost about 94% of its purchasing power.  Here is its price compared with gold since 1900.

priced in gold

Dollar chart from pricedingold.com (1)

The Fed has let the dollar lose most of its strength plus has allowed interest rates to fall so low, that safe investments cannot keep pace with the drop in purchasing power.

multi-currency-chart

Chart from Grandfather Economic Report (2)

Many investors have forgotten about the risk of a falling dollar because the greenback has been strong for the past five years.  This temporary dollar strength came after the great recession of 2009 just as there was temporary dollar strength after the great recession of the 1980s.  Then about six years after the recession, an agreement was made by major governments to weaken the dollar.

There was a severe global economic recession affecting much of the developed world in the late 1970s and early 1980s.  The United States and Japan exited the recession relatively early, but high unemployment would continue to affect Europe and the UK through to at least 1985.  As a consequence between 1980 and 1985, the US dollar had appreciated by about 50% against the Japanese yen, Deutsche mark, French franc and British pound, the currencies of the next four biggest economies at the time. Then the governments reached an agreement and exchange rate values of the dollar versus the yen declined by 51% from 1985 to 1987.

Now the world is again in the same place.  The recession is over.  Europe is a bit behind in recovery and the dollar is higher than before the recession.

There is no reason for the greenback to be  strong.

The agreement in 1985 was called the Plaza Accord.   Over just two years the greenback dropped nearly 50% versus other major currencies.  The next accord will generate great profits for those who know what to do while it ruins the purchasing power of dollar back investments.

The strong US dollar and low interest rates have created one of the biggest stock and multi currency breakout opportunities in history.  Learn how to create a plan to profit from multi currency shifts ahead.

One reason for the potential gains is that stock markets and currency values are cyclical.  Due to low interest rates created by the 2009 economic downturn, the US and a few other equity markets have risen to some of their highest prices, ever.  These markets offer very poor value now.  The steep valuation creates incredible profit potential but also hides some enormous risks.  Learn how to develop an investing strategy based of earnings, cash flows, dividends and book values to increase potential for profit and reduce the risks.

Next Extra Profit Created by Value Breakouts

Over the history of US equity markets, the  price of overall markets have risen about 9.1 percent, respectively, compounded annually.  Yet over more than a hundred years of stock market activity,  a majority of the profits have come from just a very few dramatic breakouts.

Equity markets are ruled in the short term by emotions that create unpredictable ups and downs.  Numerous fears of defaults, worries of double dip recessions, high unemployment, concerns about fiscal cliffs, hold investors back.  Yet global population growth and advances in production and prosperity are relentless economic fundamentals that increase value.

When fear holds back a a fundamentally rising value, rising profit potential grows.  Values increase as prices stagnate.  Then markets break free and rocket upwards creating wealth, prosperity and growth.

Find out which breakouts are likely to take place next.

Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 years as shown in this graph.

stock-Charts

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns create war.

Here is the war stock cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WWIII) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Learn how the Cyber War (WWIV) may change the way we live and act and how this will affect currencies and investments.

Learn:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios), but his big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on a 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of outperformance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.  This rate of expansion by the way is called the “Golden Ratio”.  It is a mathematical formula that controls the growth of most natural things; trees, the shape of leaves, the spiral of shells, as well as the way economies and societies grow.

We’ll sum the strategy, how to leverage cheap, safe, quality stocks and for what period of time based on your circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 (almost) years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy investing more with slow, worry free, good value investing.  Stress, worry and fear are three of an investor’s worst enemies.  These are major foundations of the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market they choose.  The behavior gap is created by natural human responses to fear.  The losses created by this gap grow when investors trade short term under stress.

Learn how to put meaning into your investing by creating profitable strategies that combine good value investments with unique, personal goals.

Learn how to span the behavior gap.  Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse, when they should embrace risk.  Purpose is the most powerful motivator,  stronger than fear and greed.  One powerful way to overcome the behavior gap is to invest with a purpose.

Combine your needs and capabilities with the secrets and the math of our good value model portfolio.

Share ideas about my good value portfolio.  My personal investment portfolio comes from a continual analysis of international stock markets and a comparison of their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.

Markets included in this portfolio are:

• Norway
• Australia
• Hong Kong
• Japan
• Singapore
• United Kingdom
• Taiwan
• South Korea
• China

These markets have been chosen based on four pillars of valuation.

• Absolute Valuation
• Relative Valuation
• Current versus Historic Valuation
• Current Relative versus Relative Historic Valuation

Learn how to use Country ETFs to easily construct a diversified, risk-controlled, equally weighted representative country portfolios in all of these good value countries.

To achieve this goal my portfolio consists of Country Index ETFs that track an index of shares in a specific country.  These country ETFs provide diversification into a basket of equities in the good value countries.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

This is an easy, simple and effective approach to zeroing in on value because little management and guesswork is required.  You are investing in a diversified portfolio of good value indices.  A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to pick and choose shares.  You can invest in the index which is like investing in all the shares in the index.  All you have to do is invest in an ETF that in turn invests passively in all the shares of the index.

Learn the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed a test.

The Test for Low Cost Trading

Research put every part of this portfolio in place, except knowing the best, easiest and least expensive way to buy.  A search for an optimal way to buy and hold boiled down to two methods.  One tactic to test was to use a unique online broker that appeared to offer the lowest cost deal.  The other approach was to use a community bank in Smalltown USA.  The small town bank that I use looks after my 401K trust account and their service is first class.  The benefit of small banks is that they still treat us as a human beings (instead of a number) and when we need, it’s easy to go right to the top to answer a question or get a problem resolved.  There are no call centers and the bank and the person looking after my account is just around the corner.

I created a test to see which offered the least expensive service.

Working with my banker in Smalltown USA,  I created two accounts, one at the online broker and the other at the bank. I placed $40,000 in each.

I set up the order for the country ETFs online, while my trust manager set up orders for the identical amounts of the same shares in his system.  Then we got on the phone, coordinated our timing and on a count of three each pushed the button “BUY”.

The results of this test  show how you can gain on any purchase of country ETFs.

In this special offer, you can get this online seminar FREE when you subscribe to our Personal investing Course.

Save $468.90 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip 2017” and our latest $297 online seminar for a total savings of $468.90.

ecuador-seminar

Triple Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip 2017” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

Subscribe to a Pi annual subscription for $197 and receive all the above.

Your subscription will be charged $299 a year from now, but you can cancel at any time.

Gary

 

Gary

(1) Dollar chart from pricedingold.com

(2) Grandfather Economic Report

 

Read the entire Ted Case Study has been done on sandalwood.

Profits From Ecuador Wind Power


Two technologies have potential to change competitiveness in Ecuador.

One Ecuadorian economic risk is shortage of energy.  Almost half of the country’s electricity comes from one dam.   Two changes may bring more energy to other Latin countries.    If Ecuador embraces this technology, it can gain a competitive advantage due to its many windy territories and small size.  If they do not embrace this they may lose a business edge.

Vilonaco wind farm

Photo of the Villonaco wind farm near Loja, Ecuador.

This new Ecuador wind farm has 11 generators that can create 16.5 MW.   The wind farm was developed by the Chinese company Xinjian Goldwind Science and Technology and will cut CO2 emissions by as much as 35.270 metric tons a year.   It will also reduce diesel imports that can save almost 13 million dollars a year in fuel costs.

See why Ecuador’s president refused to inaugurate this wind station at the Villonaco wind farm link below:

Change is inevitable so we should sail the winds of change looking for profit.

Latin Wind Power

Chart from “The winds of change are blowing through the Latin American energy markets”.  See article linked below

This article says: Renewable energy developers seeking the next big thing should turn their sails toward Latin America, where growing electricity demand, pro-renewable government policies, and limited fossil fuel resources are creating one of the world’s fastest-growing wind power markets.

According to research, annual wind power capacity installations will double as more than 20,000 new wind turbines are built across 15 countries

This news becomes extra important because of new technology that could cause wind power to really soar.  An article at MIT Technology review entitled “Help Wind Power Go Big” by Kevin Bullis explains this technology.  Here is an excerpt.

Low-cost materials could make storing hours of power from a wind farm economically feasible.

The intermittency of renewable power limits its use.

Utilities would love to be able to store the power that wind farms generate at night—when no one wants it—and use it when demand is high during the day. But conventional battery technology is so expensive that it only makes economic sense to store a few minutes of electricity, enough to smooth out a few fluctuations from gusts of wind.

Harvard University researchers say they’ve developed a new type of battery that could make it economical to store a couple of days of electricity from wind farms.

The new battery, which is described in the journal Nature, is based on an organic molecule—called a quinone—that’s found in plants such as rhubarb and can be cheaply synthesized from crude oil. The molecules could reduce, by two-thirds, the cost of energy storage materials in a type of battery called a flow battery, which is particularly well suited to storing large amounts of energy.

In a flow battery, energy is stored in liquid form in large tanks. Such batteries have been around for decades, and are used in places like Japan to help manage the power grid, but they’re expensive—about $700 per kilowatt-hour of storage capacity, according to one estimate. To make storing hours of energy from wind farms economical, batteries need to cost just $100 per kilowatt-hour, according to the U.S. Department of Energy.

The energy storage materials account for only a fraction of a flow battery’s total cost. Vanadium, the material typically used now, costs about $80 per kilowatt-hour.

But that’s high enough to make hitting the $100 target for the whole system impossible. Michael Aziz, a professor of materials and energy technologies at Harvard University who led the work, says the quinones will cut the energy storage material costs down to just $27 per kilowatt-hour. Together with other recent advances in bringing down the cost of the rest of the system, he says, this could put the DOE target in reach.

These two changes could create huge benefits in Latin business and consequently create profits in shares of Latin businesses that generate wind power and or can use this type of power.

Gary

We’ll have a Latin share review at our February 14-15-16 seminar.

Multi Currency Value Investing Seminar

Old Accord Creates New Profits – Multi Currency Investments.

Earn more with multi currency stock market breakouts.

Improve Safety – Increase Profits

Learn how to improve the safety of your savings and investments by selecting good value and diversified investments in a multi-currency portfolio.

Few decisions are as important to your wealth as the value of the markets and currencies you invest in.  This has been our area of expertise since the 1970s and we have worked with and advised some of the largest currency traders in the world.

Gain Protection First – Against the Dollar’s Purchasing Power Loss.  In 1913 the The Federal Reserve Act created the Federal Reserve Bank to protect the purchasing power of the US dollar, which has since lost about 94% of its purchasing power.  Here is its price compared with gold since 1900.

priced in gold

Dollar chart from pricedingold.com (1)

The Fed has let the dollar lose most of its strength plus has allowed interest rates to fall so low, that safe investments cannot keep pace with the drop in purchasing power.

multi-currency-chart

Chart from Grandfather Economic Report (2)

Many investors have forgotten about the risk of a falling dollar because the greenback has been strong for the past five years.  This temporary dollar strength came after the great recession of 2009 just as there was temporary dollar strength after the great recession of the 1980s.  Then about six years after the recession, an agreement was made by major governments to weaken the dollar.

There was a severe global economic recession affecting much of the developed world in the late 1970s and early 1980s.  The United States and Japan exited the recession relatively early, but high unemployment would continue to affect Europe and the UK through to at least 1985.  As a consequence between 1980 and 1985, the US dollar had appreciated by about 50% against the Japanese yen, Deutsche mark, French franc and British pound, the currencies of the next four biggest economies at the time. Then the governments reached an agreement and exchange rate values of the dollar versus the yen declined by 51% from 1985 to 1987.

Now the world is again in the same place.  The recession is over.  Europe is a bit behind in recovery and the dollar is higher than before the recession.

There is no reason for the greenback to be  strong.

The agreement in 1985 was called the Plaza Accord.   Over just two years the greenback dropped nearly 50% versus other major currencies.  The next accord will generate great profits for those who know what to do while it ruins the purchasing power of dollar back investments.

The strong US dollar and low interest rates have created one of the biggest stock and multi currency breakout opportunities in history.  Learn how to create a plan to profit from multi currency shifts ahead.

One reason for the potential gains is that stock markets and currency values are cyclical.  Due to low interest rates created by the 2009 economic downturn, the US and a few other equity markets have risen to some of their highest prices, ever.  These markets offer very poor value now.  The steep valuation creates incredible profit potential but also hides some enormous risks.  Learn how to develop an investing strategy based of earnings, cash flows, dividends and book values to increase potential for profit and reduce the risks.

Next Extra Profit Created by Value Breakouts

Over the history of US equity markets, the  price of overall markets have risen about 9.1 percent, respectively, compounded annually.  Yet over more than a hundred years of stock market activity,  a majority of the profits have come from just a very few dramatic breakouts.

Equity markets are ruled in the short term by emotions that create unpredictable ups and downs.  Numerous fears of defaults, worries of double dip recessions, high unemployment, concerns about fiscal cliffs, hold investors back.  Yet global population growth and advances in production and prosperity are relentless economic fundamentals that increase value.

When fear holds back a a fundamentally rising value, rising profit potential grows.  Values increase as prices stagnate.  Then markets break free and rocket upwards creating wealth, prosperity and growth.

Find out which breakouts are likely to take place next.

Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 years as shown in this graph.

stock-Charts

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns create war.

Here is the war stock cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WWIII) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Learn how the Cyber War (WWIV) may change the way we live and act and how this will affect currencies and investments.

Learn:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios), but his big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on a 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of outperformance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.  This rate of expansion by the way is called the “Golden Ratio”.  It is a mathematical formula that controls the growth of most natural things; trees, the shape of leaves, the spiral of shells, as well as the way economies and societies grow.

We’ll sum the strategy, how to leverage cheap, safe, quality stocks and for what period of time based on your circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 (almost) years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy investing more with slow, worry free, good value investing.  Stress, worry and fear are three of an investor’s worst enemies.  These are major foundations of the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market they choose.  The behavior gap is created by natural human responses to fear.  The losses created by this gap grow when investors trade short term under stress.

Learn how to put meaning into your investing by creating profitable strategies that combine good value investments with unique, personal goals.

Learn how to span the behavior gap.  Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse, when they should embrace risk.  Purpose is the most powerful motivator,  stronger than fear and greed.  One powerful way to overcome the behavior gap is to invest with a purpose.

Combine your needs and capabilities with the secrets and the math of our good value model portfolio.

Share ideas about my good value portfolio.  My personal investment portfolio comes from a continual analysis of international stock markets and a comparison of their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.

Markets included in this portfolio are:

• Norway
• Australia
• Hong Kong
• Japan
• Singapore
• United Kingdom
• Taiwan
• South Korea
• China

These markets have been chosen based on four pillars of valuation.

• Absolute Valuation
• Relative Valuation
• Current versus Historic Valuation
• Current Relative versus Relative Historic Valuation

Learn how to use Country ETFs to easily construct a diversified, risk-controlled, equally weighted representative country portfolios in all of these good value countries.

To achieve this goal my portfolio consists of Country Index ETFs that track an index of shares in a specific country.  These country ETFs provide diversification into a basket of equities in the good value countries.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

This is an easy, simple and effective approach to zeroing in on value because little management and guesswork is required.  You are investing in a diversified portfolio of good value indices.  A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to pick and choose shares.  You can invest in the index which is like investing in all the shares in the index.  All you have to do is invest in an ETF that in turn invests passively in all the shares of the index.

Learn the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed a test.

The Test for Low Cost Trading

Research put every part of this portfolio in place, except knowing the best, easiest and least expensive way to buy.  A search for an optimal way to buy and hold boiled down to two methods.  One tactic to test was to use a unique online broker that appeared to offer the lowest cost deal.  The other approach was to use a community bank in Smalltown USA.  The small town bank that I use looks after my 401K trust account and their service is first class.  The benefit of small banks is that they still treat us as a human beings (instead of a number) and when we need, it’s easy to go right to the top to answer a question or get a problem resolved.  There are no call centers and the bank and the person looking after my account is just around the corner.

I created a test to see which offered the least expensive service.

Working with my banker in Smalltown USA,  I created two accounts, one at the online broker and the other at the bank. I placed $40,000 in each.

I set up the order for the country ETFs online, while my trust manager set up orders for the identical amounts of the same shares in his system.  Then we got on the phone, coordinated our timing and on a count of three each pushed the button “BUY”.

The results of this test  show how you can gain on any purchase of country ETFs.

In this special offer, you can get this online seminar FREE when you subscribe to our Personal investing Course.

Save $468.90 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip 2017” and our latest $297 online seminar for a total savings of $468.90.

ecuador-seminar

Triple Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip 2017” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

Subscribe to a Pi annual subscription for $197 and receive all the above.

Your subscription will be charged $299 a year from now, but you can cancel at any time.

Gary

 

Gary

(1) Dollar chart from pricedingold.com

(2) Grandfather Economic Report

 

MIT Technology Review  Help Wind Power Go Big

Renewable energy sails toward Latin America The winds of change are blowing through the Latin American energy markets.

Demographic Profit Pyramid


Here is a demographic profit pyramid from the US Census Bureau.

The keys to economics can be spelled our as PROFIT:  People… Resources… Output… Free Trade… Innovation and Time

The study of demographics is the People in the Profit and can give us many clues.

Take for example the population pyramid of Ecuador.   This shows a young growing population… a good place to be.

ecaudor population pyramid

I included this pyramid here just to show an example of a good base though Ecuador does not have a stock market due to lack of Free Trade and Innovation.

The chart below, from the U.S. Census Bureau shows the U.S. population pyramid as of 2010 (the date the bureau works from at this time) and a prediction of the pyramid in 2020.

Us population pyramid

This pyramid shows a growing problem.

Since this chart if three years old we can throw some time into our calculations.  The group aged 60 to 64 (red) and older are now aged 63 to 67 at and are retiring or retired and already represent a sizable population.

There is still a fair base of the population at work who can support these retirees.

A much larger wave now aged 58 to 62 (yellow 55 to 59 in the chart) hit retirement age in five years.  This is when the problem really begins.

Then when those aged 53 to 57 (green) begin to retire in ten years, the problem REALLY starts to become severe and just gets worse and worse after that.

Too many retirees… not enough workers.

Problems are Opportunities

We would see similar patterns in Japan and Europe so a huge chunk of the industrialized world faces a serious demographic crunch.

There is one more bitter demographic onion hiccup in this economic stew.  A growing global population but with finite resources.  More People… less Resources.

How will humanity deal with this.   Humanity will deal with it and those who figure out how now can profit on the leading edge.  

Screen shot 2013-01-08 at 7.12.38 AM

Sharpest knife in the world.

The leading edge can be sharp but we do not have to have the sharpest knife to slice through the demographic data to see what is happening.

#1: Many retirees are working longer.

#2: Everyone is becoming more productive.

#3: Many retirees are moving either to lower cost countries or to smaller towns.

Studies suggested that as many as 10% of retirees will move abroad. Another 10% are thinking of a part time international shift.

Many are moving to Ecuador now. In a few decades, as this pyramid projection shows… the social system in Ecuador will be more strained.

ecaudor population pyramid

Wealth flowing in from retirees will help.

80% to 90% of retirees will stay at home but also move.

An article based on boomer quiz by the Retirement Ranger entitled “Surprising New Survey Finds Many Retirees Plan on Moving in Retirement” gives us a clue.

Here are excerpts (see a link to the entire article below):

5000 people took a Retirement Ranger Quiz and show that the vast majority of Ranger plan on moving in retirement.  Taxes, cost of living, and region are all important considerations for just about everybody taking the quiz.

Q: Will you move in retirement, and how far?

39% said they plan on moving out of state or out of the country. The most startling difference from other surveys is how few people taking the Retirement Ranger plan on staying where they are now – just 2%. The biggest category of responses on this category is the 46% who plan on moving out of their “current metro” – presumably not too far from where they live now, but a move from their current home at least. Presumably that means they intend to downsize and/or find a home in a more retirement friendly location or development – but not move too far away from where they live now.

Q: Cost of living preference?

These results surprised us. Against a steady drumbeat of interest in low-cost of living responses, the fact is that the majority of people (62%) taking the Retirement Ranger are looking for an average cost of living. There were 30% who are looking for a lower cost of living (a much smaller number than we would have thought), compared to a paltry 6% who for some reason want a higher cost of living.

Q:  What environment are you looking for?

The results to this question are refreshing – Topretirements visitors are looking for all kinds of experiences – from coastal to lakes to college towns to suburbia. Aside from a clear preference for a coastal environment, most other environments were fairly close together. College towns, small towns, and suburbia were slightly preferred over the mountains or an urban experience. Deserts and a rural environment brought up the rear in retirement interest.

Q: Size of town?

This question gave some dimension to the previous question about the kind of town these prospective retirees want to live in. By far, most people are open minded on this question too – they do not have a strong preference on the size of town they want to retire to. Of those who do care, in general it seems the smaller the better – 0-25,000 population got the most interest, followed by towns 25,001-100,000, and bringing up the rear – cities of more than 100,000.

Q: Would you like to find a retirement destination with a lower than average tax burden?

The short answer is yes, but not nearly as emphatically as we might have thought. This was a yes or no question: 58% apparently could be induced to move by a low tax burden, while the remaining 42% have no strong preference.

Demographic evidence evidence such as this is one reason we have started a magazine business focused on communities of 30,000.

Learn more about this micro publishing opportunity, Order the FREE report here.  How to Earn With Positive Community News 

Think about who will profit from growing demographics shifts of this nature as these will be good places to invest.

Gary

Learn about places to invest based around demographics at our next Super  Thinking + Investing and Business seminar.

Multi Currency Value Investing Seminar

Old Accord Creates New Profits – Multi Currency Investments.

Earn more with multi currency stock market breakouts.

Improve Safety – Increase Profits

Learn how to improve the safety of your savings and investments by selecting good value and diversified investments in a multi-currency portfolio.

Few decisions are as important to your wealth as the value of the markets and currencies you invest in.  This has been our area of expertise since the 1970s and we have worked with and advised some of the largest currency traders in the world.

Gain Protection First – Against the Dollar’s Purchasing Power Loss.  In 1913 the The Federal Reserve Act created the Federal Reserve Bank to protect the purchasing power of the US dollar, which has since lost about 94% of its purchasing power.  Here is its price compared with gold since 1900.

priced in gold

Dollar chart from pricedingold.com (1)

The Fed has let the dollar lose most of its strength plus has allowed interest rates to fall so low, that safe investments cannot keep pace with the drop in purchasing power.

multi-currency-chart

Chart from Grandfather Economic Report (2)

Many investors have forgotten about the risk of a falling dollar because the greenback has been strong for the past five years.  This temporary dollar strength came after the great recession of 2009 just as there was temporary dollar strength after the great recession of the 1980s.  Then about six years after the recession, an agreement was made by major governments to weaken the dollar.

There was a severe global economic recession affecting much of the developed world in the late 1970s and early 1980s.  The United States and Japan exited the recession relatively early, but high unemployment would continue to affect Europe and the UK through to at least 1985.  As a consequence between 1980 and 1985, the US dollar had appreciated by about 50% against the Japanese yen, Deutsche mark, French franc and British pound, the currencies of the next four biggest economies at the time. Then the governments reached an agreement and exchange rate values of the dollar versus the yen declined by 51% from 1985 to 1987.

Now the world is again in the same place.  The recession is over.  Europe is a bit behind in recovery and the dollar is higher than before the recession.

There is no reason for the greenback to be  strong.

The agreement in 1985 was called the Plaza Accord.   Over just two years the greenback dropped nearly 50% versus other major currencies.  The next accord will generate great profits for those who know what to do while it ruins the purchasing power of dollar back investments.

The strong US dollar and low interest rates have created one of the biggest stock and multi currency breakout opportunities in history.  Learn how to create a plan to profit from multi currency shifts ahead.

One reason for the potential gains is that stock markets and currency values are cyclical.  Due to low interest rates created by the 2009 economic downturn, the US and a few other equity markets have risen to some of their highest prices, ever.  These markets offer very poor value now.  The steep valuation creates incredible profit potential but also hides some enormous risks.  Learn how to develop an investing strategy based of earnings, cash flows, dividends and book values to increase potential for profit and reduce the risks.

Next Extra Profit Created by Value Breakouts

Over the history of US equity markets, the  price of overall markets have risen about 9.1 percent, respectively, compounded annually.  Yet over more than a hundred years of stock market activity,  a majority of the profits have come from just a very few dramatic breakouts.

Equity markets are ruled in the short term by emotions that create unpredictable ups and downs.  Numerous fears of defaults, worries of double dip recessions, high unemployment, concerns about fiscal cliffs, hold investors back.  Yet global population growth and advances in production and prosperity are relentless economic fundamentals that increase value.

When fear holds back a a fundamentally rising value, rising profit potential grows.  Values increase as prices stagnate.  Then markets break free and rocket upwards creating wealth, prosperity and growth.

Find out which breakouts are likely to take place next.

Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 years as shown in this graph.

stock-Charts

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns create war.

Here is the war stock cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WWIII) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Learn how the Cyber War (WWIV) may change the way we live and act and how this will affect currencies and investments.

Learn:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios), but his big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on a 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of outperformance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.  This rate of expansion by the way is called the “Golden Ratio”.  It is a mathematical formula that controls the growth of most natural things; trees, the shape of leaves, the spiral of shells, as well as the way economies and societies grow.

We’ll sum the strategy, how to leverage cheap, safe, quality stocks and for what period of time based on your circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 (almost) years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy investing more with slow, worry free, good value investing.  Stress, worry and fear are three of an investor’s worst enemies.  These are major foundations of the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market they choose.  The behavior gap is created by natural human responses to fear.  The losses created by this gap grow when investors trade short term under stress.

Learn how to put meaning into your investing by creating profitable strategies that combine good value investments with unique, personal goals.

Learn how to span the behavior gap.  Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse, when they should embrace risk.  Purpose is the most powerful motivator,  stronger than fear and greed.  One powerful way to overcome the behavior gap is to invest with a purpose.

Combine your needs and capabilities with the secrets and the math of our good value model portfolio.

Share ideas about my good value portfolio.  My personal investment portfolio comes from a continual analysis of international stock markets and a comparison of their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.

Markets included in this portfolio are:

• Norway
• Australia
• Hong Kong
• Japan
• Singapore
• United Kingdom
• Taiwan
• South Korea
• China

These markets have been chosen based on four pillars of valuation.

• Absolute Valuation
• Relative Valuation
• Current versus Historic Valuation
• Current Relative versus Relative Historic Valuation

Learn how to use Country ETFs to easily construct a diversified, risk-controlled, equally weighted representative country portfolios in all of these good value countries.

To achieve this goal my portfolio consists of Country Index ETFs that track an index of shares in a specific country.  These country ETFs provide diversification into a basket of equities in the good value countries.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

This is an easy, simple and effective approach to zeroing in on value because little management and guesswork is required.  You are investing in a diversified portfolio of good value indices.  A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to pick and choose shares.  You can invest in the index which is like investing in all the shares in the index.  All you have to do is invest in an ETF that in turn invests passively in all the shares of the index.

Learn the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed a test.

The Test for Low Cost Trading

Research put every part of this portfolio in place, except knowing the best, easiest and least expensive way to buy.  A search for an optimal way to buy and hold boiled down to two methods.  One tactic to test was to use a unique online broker that appeared to offer the lowest cost deal.  The other approach was to use a community bank in Smalltown USA.  The small town bank that I use looks after my 401K trust account and their service is first class.  The benefit of small banks is that they still treat us as a human beings (instead of a number) and when we need, it’s easy to go right to the top to answer a question or get a problem resolved.  There are no call centers and the bank and the person looking after my account is just around the corner.

I created a test to see which offered the least expensive service.

Working with my banker in Smalltown USA,  I created two accounts, one at the online broker and the other at the bank. I placed $40,000 in each.

I set up the order for the country ETFs online, while my trust manager set up orders for the identical amounts of the same shares in his system.  Then we got on the phone, coordinated our timing and on a count of three each pushed the button “BUY”.

The results of this test  show how you can gain on any purchase of country ETFs.

In this special offer, you can get this online seminar FREE when you subscribe to our Personal investing Course.

Save $468.90 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip 2017” and our latest $297 online seminar for a total savings of $468.90.

ecuador-seminar

Triple Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip 2017” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

Subscribe to a Pi annual subscription for $197 and receive all the above.

Your subscription will be charged $299 a year from now, but you can cancel at any time.

Gary

 

Gary

(1) Dollar chart from pricedingold.com

(2) Grandfather Economic Report

 

Surprising New Survey Finds Many Retirees Plan on Moving in Retirement

Profits for Wealth and the Environment


One reason I like investing in timber is one can profit and help the environment at the same time.

Before we look at the money and the environmental elements let me hasten to warn you… I am prejudiced about trees.  I love them too much.

Douglas Fir

Limbs on a Douglas fir (click on photo to enlarge).

Sometimes the oddest things shape us… our lives… the way we feel about certain things.  Perhaps it was the experience of low hanging branches and the close limbs in the old stand Douglas fir forest behind my childhood home.   Those limbs made for easy climbing and I was always in those trees, climbing… building tree forts, watching the views from 100 feet up.   The trees were my friends!

This month’s issue of National Geographic has a must read article about a 3,200 year old Sequoia giant called, The President.

Nat Geo President Image

This picture is from that National Geographic article and this tree is just overwhelming to me. That little orange spot at the base is a man.  I have linked the article below because the photo is so outstanding that this small reproduction does not do it justice.  Be sure to read that article!

We have some huge old stand Hemlocks at our North Carolina farm as well.

merrily farms hemlcok

I am the green spot at the base and call these hemlocks, the Grandfathers.  They are no match in size for the old Douglas firs. They pale in comparison to the Sequoia… but I love them as well.  The hemlock has been attacked by the Wooly Adelgid blight on the US eat coast and we have spent thousands of dollars protecting these few old trees.

It’s good to be cautious when you read what I write about investing in trees.  I probably let my heart overly influence my pocketbook.

However investing in timber can be highly profitable and since there is a demand for wood… let’s cut stuff we grow specifically for lumber rather than cutting down the grand old stuff or any others!  What I like is to plant trees as a crop in areas that are bare and then harvest, sell, and replant.

Steve Rosberg is a good friend.  He was my banker in Ecuador for some years… more than a decade ago and then he returned to his homeland of Argentina and started two agricultural businesses… one in timber… one in vineyards. Here are Steve’s insights on investing in timber in Argentina… Uruguay and Ecuador… plus there are valuable tips about investing in timber anywhere.

The Economics of Timberland Investment – Ushay’s Outlook

By Steve Rosberg

timber

Argentine Timber.

“Timberland is an alternative asset class with a proven record of dependable returns.  It possesses unique qualities that offer an inflation hedge for portfolios making it especially attractive in today’s volatile economy.


Timber stumpage is a commodity whose price has historically tracked population growth and GDP.  Timberland offers owners the ability to hedge down markets by storing inventory on the stump, all while it grows.  Purchased conservatively, timberland offers great opportunities to add diversified revenue streams to your portfolio.” The University of Georgia – Center for Forest Business.

The Global Perspective

Forests have been providing essential services to mankind – to all inhabitants of the biosphere – since the beginning of time.

In our age, this ranges from the tangible uses such as firewood, construction material, pulp for industry, chemicals – and so, on and on – and less immediately visible outputs such as soil erosion protection, water and air cycle services, three-dimensional habitat allowing the development of great biodiversity, and a host of others. We want forests, we need forests for our survival.

Nature provided the planet with a great stock of forests, which mankind has been using forever. Total forested surface is decreasing – based on the last FAO statistic that I saw – at about 1% a year.

Use of forest products grows together with population growth and GDP growth.

We see the writing on the wall of rising population and rising GDP.

The responses to these trends follow two lines of action:

−    Attempts to protect natural forests from further reductions. This is important, as natural forests are very rich habitats and clearing them destroys their diversity irrevocably. Recreation of natural forests takes incredibly long time, and is always a different outcome than what was there before.

−    Substitute timber sources (and other forestry services) with plantation forests as much as possible, thus relieving the natural forests from the pressure.

Plantation forests are still only a small portion of total forested surfaces, but are already taking a lot of the pressure off some of natural forests’ more prized trees and massive industrial uses of their timber. Plantation latifoliate species are replacing the hardwoods with timber of similar characteristics at a fraction of the price. And they are doing so sustainably.

Plantation forests are generally monocultures – one or two species over great tracts of land – and tend to get environmentalists complaining of the loss of diversity. They are not wrong, in the same way that farming wheat, corn,  sunflower, soy, or any agricultural venture is a monoculture of similar characteristics. The real discussion is not about “good-bad” but about complex cost-benefit conditions in different situations. Except for the case in which a natural forest is clear-cut to make way for a plantation forest (yes, it happens …) the economic and the environmental balance tips in favor of plantations.

As you can see, when we talk of timberland investment, we need to define our terms. It can refer to buying an asset that will contain natural forest for preservation, for clearing and regrowth, for gradual selective use on a presumably sustainable basis, or to an asset containing a plantation forest. These are all “timberland” – but all essentially different assets, and completely different businesses.

Timber prices vary enormously, as timber tends to have a very low price per volume and transportation costs take on a very high incidence in the price a tree is worth on the stump.

Generally speaking, prices for timber on the stump will be those that the mills (sawmills, pulp or chipboard) are willing to pay, minus freight, handling, and cutting costs. Of these, other than the actual mill price, freight is the largest factor.

A corollary of this is that timber too far from industry may not be economically viable to harvest, so merely having thousands of acres of timberland is not an adequate measure of economic value.

Aside from stumpage price, the factors determining the profitability of a plantation are related to production cost, the dominant factors being land price and tree-growth speed.

Forestry is conceptually very much like a zero-coupon bond: you buy it today, and hold it to maturity, with no cash flow in between.

What you pay in up-front is the land value (there are other alternatives, but this works to get our ideas on the same page), planting costs, care and management until harvest. You may have some  income along the way from thinning and revenue from cattle grazing.

Comercially viable trees grow at different speeds in different places. For pines, in Canada and northern Europe it will take around 60 to 65 years. In southern US, where they get more light, it’s faster, around 30 years. In Corrientes, Argentina, around 15 years.

Obviously, for similarly priced land, and similarly priced trees, the fastest growing is the more profitable.

Whatever the particular equation, I think the following graph – drawn up by the University of Georgia – highlights  forestry’s central attraction: most of its growth in value comes from biology.

timber

Clearly, this graph will be different for each region of the planet, but I think the central driver will be equally predominant.

In short, from a global perspective, we have diminishing forest stocks, growing numbers of people demanding forest products, growing uses for forest products (with no substitute product on the horizon) and the ability to gradually balance the trends with plantation forests. The renewed use of forest-sourced biomass for energy will promote the growth of plantation forests and make them significantly more profitable, as will be discussed below.

What Type Timber Investment Vehicles?

From now on, all we will consider are plantation forests of a commercial nature (i.e. planted with profit in mind). For readers with acute environmental sensitivity, we stand by our statement that this is generally an environmentally positive investment from a preservation of natural forests perspective, and also an extremely efficient means of carbon sequestration.

All other forest-type investments fall into categories that are not profit-driven, so making comparisons becomes subjective .

There are also a number of different ways to hold timberland investments:

– You own the land, and the forest.

This is the cleanest situation, which forces you to appraise the property’s characteristics, determine its potential, budget and forecast, plant, care and harvest. There are TIMOs – timber investment management organizations – who will help you run this investment. Some will do pooled investment projects, so that you don’t need to be a zillionaire to have an economically viable plantation.

This type of investment is generally illiquid – you don’t go and sell a plot of land, or a participation in one – in the blink of an eye, it takes about as long as any other real-estate transaction. But, if you have the carrying capacity and foresight to separate your long term investments from your liquidity requirements, you benefit from:

– the intimate knowledge of the property (maximizes potential) and funding structure (minimizes surprises)

– buying the land at face value

– planting and caring for the trees at cost

– paying for the management at cost.

By now, you have probably realized that if you could hold a number of these investments, with tree-harvests scaled every year, or two years, in the same way that you can step your time-deposit maturities, you could be getting annuities with timber’s high returns, putting a little aside for replanting, and going on for another cycle, and so on indefinitely.

– You can also buy a REIT, or a listed company owning timberland

This form of investment has the great advantage over direct ownership that the asset is listed, and you have instant liquidity.

Now, to the flip side of the coin:

– They tend to have other assets bunched in there, like industry, for example. Which is fine if you want that, but it distorts the nature of “timberland” as an asset class.

– More importantly, in my opinion, is the fact that they tend to have hefty liabilities. To take an example, Plum Creek’s year-end debt was 47% of its assets in 2011. Now, aside from your timberland asset, you have interest rate management exposure, and credit renewal risk thrown in there. This is leverage, it can be wonderful. Or not. It is leverage, not timberland.

– The market prices for these assets is based on their cash flow expectation, which means, by discounting expected future revenues. The interest rate becomes your determining factor for pricing these assets. If it is low, you will buy timberland with low yields as the price will be high. Of course, you could argue that this will allow you to buy cheap timberland in high interest times, and have capital gains when the rates fall, and it’s true. But why not then trade interest rate options?

– Sometimes, the companies’ revenues are derived from purchases and sales of land. Which is also fine, but not “timberland investment”, which was the asset class we were looking at.

In short, REITs and timber companies may be wonderful investments, or not, but do not necessarily represent the asset class you are considering, and – most probably – the market will have taken a lot of the upside out of the underlying asset by the time you get to it.

The Need for a More Local Focus

The tremendous dispersion in timber growth speeds, and end-market conditions for timber, requires that in evaluating a timberland investment we take a more local focus. We need to scratch the surface and understand the rationale for holding any single property, or sets of properties. We are dealing with communities of living beings, that grow, mature and die, and if we are to make the most of such an investment, need to take this into account during their life-span.

As you saw above, the dispersion in timber growth rates is enormous, as is also the distance to industry in each case, both factors affecting profitability.

A key consideration is how will the investment be funded due to the very long growth cycles, with no significant cash flow. We mentioned earlier that if timberland will be funded with credit, unless the tenor of the credit matches the tree-growth period, there is a serious roll-over risk. Or should we say “inability to roll over” risk. Actually, it is two risks: the risk that there is nobody willing to roll over at maturity time – something which was inconceivable in first world economies until 2008, but which has been common in developing world. And the risk that the interest rate prevailing at renewal time is very high. In fact, it could be higher than the biological growth rate of the trees.

How Ushay has Structured its Business

We develop timberland investment projects in Corrientes Province, in Northeastern Argentina. We do so in such a way that each property is held in an individual trust, and investors buy participations in the trusts. This gives them collectively title to the land, the trees, and every business that is done on the property.

Each property is analyzed in depth to determine it’s best potential, and the investment project is designed around that.

Investors fund the project, and there is no financial debt associated with it, thus eliminating the risk of an asset being erased from the face of the earth due to leverage, which we have all become too familiar with in recent times.

Minumum investment size is USD 50,000 (earlier projects had a USD 100,000 minimum).  This allows investors to gradually build a portfolio of properties maturing over the years, as we expand into new projects.

Growth rates for pine and eucalyptus in Corrientes is as high as it gets – anywhere in the world – as is shown in Jaako Poyri’s graph below:

timber

All of our properties are in a radius of 6 miles, allowing for cost-efficient operation. All are on paved roads. All are within 25 miles of the nearest city. Our projected acquisitions for the coming years all fit these categories, although land prices will not wait for us.

Industrial investment – third parties’ and arranged by us – is coming in the area, driven in part by Brazil, only 60 miles away, with a very avid demand for timber products. The new industry will eventually allow us to at least double our projected stumpage prices, which means that all our projects’ projected yields will be much higher than the initial estimates.

Another plus is the fiscal treatment of timberland in Argentina, as it is virtually income-tax free (the growth of the timber as appraised year by year is exempt) and there are land tax and asset tax exemptions. In this, it is unique, and for investors not taxed on global revenue, this is an exceptional plus.

Pricing and Comparisons    

The chart below shows US timberland prices in USD per acre as reported by Brookfield Asset Management.

timber

Our El Carrizal Forestry Trust is currently selling for USD 1,500 per acre. Unlike the graph at right, the Carrizal price has projected management and upkeep for the duration of the forest included in the initial investment.

To Summarize:

The investor in an Ushay timberland project should expect to take away between 5 and 6 times his initial investment in a 15 year period adjusted for inflation, and still be left with the initial investment ready for another cycle.

New industry in the area will improve this equation even more.

Low entry levels per project allow the investor to “ladder” investments over time so as to create a portfolio of timberland properties with harvests in successive years. As the land goes right back into production for another cycle, this can be structured to be a perpetual source of family wealth.

And, if an investor owns a SUV, he can tell his conscience and neighbors to forget about his carbon footprint.

Timber investments can be profitable and more. They are to me… the ultimate dimensional investment.

Here is our North Carolina summer home (upper right).

merrily farms

We have a wonderful cool place to live and for me to play surrounded by a green inventory that grows in value.  Plus it serves as a great seminar center allowing delegates to enjoy the forests.  With our sustainable forestry, we can continually improve the forest and if due to low prices or because we love the trees too much, and we do not harvest then the value just keeps rising.

The first property we ever purchased in Ecuador (and one we do not plan to sell) is our hacienda Rosaspamba… almost 1,000 acres of forest… a lot of it virgin timber.  We let locals farm it on a growing reserve of potential, rich farmland, timber… and fresh air and a bold trout river.  The place where we can really get away in the Land of the Sun.

rosaspamba

These are what Merri and I consider great multi dimensional values.  We invite you to learn more about farming and timber in South America and the USA.

Gary

Learn Spanish as you learn about South American farming and timber.  Meet Steve Rosberg in Argentina or Uruguay.  Steve will provide a presentation about timber and agricultural investments during the Super Thinking + Spanish courses in Montevideo this February.  Join Our Super Spanish teacher, Spiro Michas, and Steve Rosberg as you learn to speak Spanish in three days and find out more about timber and agricultural investments in Argentina and Uruguay.

Read National Geographic article Snow Tree

 

13 Reasons for a Farm


See 13 and more reasons to invest in a multi dimensional farm below.

Does this look like a high tech internet marketing genius?  He is… our webmaster David Cross working on his farm. He is multi dimensional!

He just created a new website that readers can enjoy called watertheroots.com.

David Cross

Click on photo to enlarge.  To read David’s Watertheroots.com site, click here

More and more people are creating multi dimensional lifestyles that include farming.  They earn income in two ways… one is the production of food.  The purchasing power of money may disappear.  Eating will always remain in demand.

Merri and I are publishers but also have two income producing farms.  David, as you can see at Watertheroots, is a website specialist…. but has his farm.

Another friend has now jumped on the multi dimensional bandwagon.  Merri and I spent our weekend with friends, Mark and Vanessa Owens, from Naples, Florida.  Mark has been a real estate broker and very successful general contractor but has now leased an 11 acre farm where he is growing organic crops to sell in health food stores and organic markets.

Having a multi dimensional life in Smalltown USA makes sense now.

Excepts from a recent USA Today article entitled “Wealth rises in USA’s heartland” written by Dennis Cauchon shows why.

The article (bolds are mine) says: Personal income in the USA’s metro regions and counties and the percentage change from 2007, before the recession and financial crisis.

Small-town America is better off: Inflation-adjusted income is up 3.8% per person since 2007.

The nation’s oil and gas boom is driving up income so fast in a few hundred small towns and rural areas that it’s shifting prosperity to the nation’s heartland, a USA TODAY analysis of government data shows.

The 261 million people who live in cities and suburbs still haven’t recovered earning power lost in the economic downturn. Average income per person fell 3.5% in metropolitan areas between 2007 and 2011 after adjusting for inflation, according to data released Monday by the federal Bureau of Economic Analysis.

By contrast, small-town America is better off than before: Inflation-adjusted income is up 3.8% per person since 2007 for the 51 million in small cities, towns and rural areas.

The energy boom and strong farm prices have reversed, at least temporarily, a long-term trend of money flowing to cities.  Last year, small places saw a 3% growth in income per person vs. 1.8% in urban areas.

Small-town prosperity is most noticeable in North Dakota, now the nation’s No. 2 oil-producing state. Six of the top 10 counties are above the state’s Bakken oil field.  “Give us a little shale, and we’ll show some pretty good income growth, too,” says Bill Connors, president of the Boise Metro Chamber of Commerce in neighboring Idaho.

The Boise area’s rank in income per person plummeted from 139th to 251st among metro areas from 2007 to 2011, the biggest drop of any place except Las Vegas, which suffered largely because of high-tech layoffs and a real estate price collapse.

The famous adage of “follow the money” makes sense and in this series we’ll see numerous reasons beyond farming and shale why the money is shifting to Smalltown USA.

Those looking to move their next life’s adventure abroad will find sense in farming as well.

Jean Marie Butterlin who conducts Ecuador farm tours sent this note:

Why an agriculture investment in Ecuador makes a lot of sense NOW!

We have been writing a lot about Ecuador agriculture investing in the last 2 years when not a lot of people were talking about that type of investment;

In the last few months a lot of what we said then, has even become more relevant :

Here are 13 reasons why :

1- GMO is a failure: even the Big Chemical Companies’ specialists agree, that the GMO promises that were made in early 2000 have lead to some serious disasters esp. in India where yields have come down drastically and the use of herbicide is now higher than with the non GMO crops.

2- We have talked at length about inexpensive arable land in Ecuador. One new factor in Ecuador is the recognition by some local investors that putting their money in good land is a logical decision. About half of the land that we had for sale a year ago has been sold to Ecuadorians; this alone shows that Ecuador land is a good value.

3- World population is growing even faster than before and food supply is limited. Food prices have gone steadily in the last 2 years. Diversification is growing and a lot of arable land disappears every year from the planet.

4- There are only 3 criteria when investing in agriculture, water, water and water.  This is the reason that we have only been offering land with sufficient water availability all year round.

5 – Ecuador has good and cheap labor: although we have seen some wage increases Ecuador still has a large untapped pool of good and inexpensive labor.

6 – Ecuador has improved infrastructure in the last 2 years: the roads in Manabi for example are much better and it is much easier to get to the Manta port.

7 – The local domestic market: Ecuador still is in need for more supply of locally grown crops like plantain which yield all year long very nice profits.

8 – Ecuador due to its special location on the Equator line has a nice climate and can produce up to 4 harvests per year.

9 – There are lots of crops that are difficult to grow elsewhere and yet grow easily in Ecuador, which means less competition and better prices.

10 – Land prices are rising now but are still cheaper than in Chile, Uruguay or Brazil.

11 – Chinese are buying everywhere around Ecuador; one day they will discover it too.

12 –  Climate changes have wrought havoc in some countries and have brought a lot of crop destruction and/or lower yields.

13 – In 5 years I predict the good agriculture investment opportunities in Ecuador will be gone.

We have seen more and more people coming down to Ecuador asking us to find them smaller farms where they could be self sustainable and make a good living at the same time.

That is why we are offering  our Small farm tour  which includes 2 days of farm showing and one day of real estate in the Bahia area.

Space is limited and the number of farms available are limited also. Good small farms with water, close to cities, are hard to find.

Prosper in Change

In the complicated, rapidly changing global economy it often seems hard to know what to do next.   The more complicated the problem, the more simplicity is required.

The simplest law of commerce is that everyone must eat!

A growing global population creates increased demand.  The supply of land and water is finite so the cost of food is likely to rise.  This formula suggests that multi dimensional earning that includes agriculture and makes great sense now.

Gary

Here is a way to look at Ecuador farm property.

ecuador-agriculture-tour

Imagine having a multi dimensional opportunity like this.

There are opportunities to own an Ecuador farm with a combination of beach front and agriculture.

ecuador-agriculture-tour

Delegates visiting Ecuador farm on beachfront with multi dimensional opportunity.

Learn about Ecuador farm tours here.

Farm and write to sell as Merri and I and our webmaster do.

Seven P Secrets of Self Publishing

When you write, you can work anywhere. 

gary-scott-image

Here I am working poolside in the winter, at our Florida farm.

gary scott

Here I am with our hound Ma, working during the summer at our North Carolina farm.

Learn how to earn everywhere, while living anywhere you choose.  I have been able to earn by writing in Hong Kong, England, the Isle of Man, Dominican Republic and Ecuador to name a few of the place I have lived.  Everywhere I have been… too numerous to share here, I have been able to work.

All I need is my laptop.

That’s all you need too… a laptop to be free!

Before computers, a pencil and pad did the job.

Freedom is just one benefit you can gain from writing.

Another benefit is income.   Writing has brought me both our farms, free and clear… plus a lot more.

Another good example of earning potential is my friend Hugh Howey.   He was working for $10 an hour in a book store when he self published his novel Wool, typing in a storage room during his lunch breaks.

Soon he was earning over $100,000 a month on Amazon.com.  This helped secure a six-figure book deal from Simon & Schuster, and an option for film by Ridley Scott, director of Blade Runner and Alien.

That’s what he’s doing now.

Hugh Howey

Sometimes Hugh and I get together at my  farm and play chess (he beats me badly).

Writers like High are great inspirations.

A couple of years ago Hugh  left Florida, and moved to South Africa.  He had a sailing catamaran built for him and now can sail the world while he continues to write.

Hugh explained it like this: And that’s the miracle of working as a writer: I can do it from anywhere and everywhere. The past few years, I’ve done a lot of writing from airplanes and airports while on business trips abroad.  SAND was entirely written overseas while traveling through seven different countries; I think it’s a better story because of those inspirations.  In upcoming years, I may be writing near your home port.

Hugh’s a super star writer and his success could not happen to a more deserving and talented person.  He pours enormous energy into being worthy of his readership.  But you do not have to be a million dollar a year earner or a traveler to benefit from writing.

The good news is… you do not need a huge success to have a rich and fulfilled lifestyle.  Self Publishing can bring you a life that most people only dream of, as a journeyman writer, instead of a super star.

May I hastily add that the path to stardom begins as a journeyman… so the journeyman’s path brings success without stardom… but can also lead to stardom.

What most success stories like Hugh’s rarely explain is the many hours of writing that was devoted before their self published book sales soared.   Hugh, like most writers were journeymen first.  Stardom came later.

Here are sevens secrets that can help you become a journeyman writer. 

The secrets are a writer’s armory of tools that allows almost anyone to create successful publications for income, freedom and fulfillment.

Take Merri’s and my publishing business as an example.  

Merri and I are not writing stars.  We are journeymen who have for more than 40 years, year in and year out, earned solid income writing and self publishing dozens of publications about multiple subjects.

Some years that income has been more than solid… over a million dollars.  Yet in terms of stardom, we are hardly known.

In a moment you’ll see why that’s fine for us and probably will be for you too.

First some history.

Merri became involved in self publishing over 40 years ago… first helping a veterinarian publish a book on a very specific market… animal acupuncture. Then she showed a needle point artist how to sell more books to an even more specific audience… “needle point enthusiasts”  about her needle point work to an audience larger than the population of the city she lived in.  This led Merri to eventually become Executive Editor of an award winning magazine in Florida.

My story allowed Merri and me to work and live from Hong Kong to London to Europe to Eastern Europe, then the Caribbean and then Ecuador… making millions in the process of following our adventures… having fun… while helping a large readership adapt to a rapidly changing world.

That’s what self publishing can bring, profit, adventure and fulfillment, a great feeling of worth and wonder.

Self Publishing has created exactly the lifestyle we desire allowing us to span the world and work with meaning and purpose.

Self Publishing has become a new business art form. 

The seven secrets can help you start your own self publishing business now.

Everything in publishing is new and exciting and changing.  Publishing is being recreated by the wonderful power of destructive technology.

Everything is new… except the seven secrets. 

Change in the publishing industry is disturbing many.   We love this evolution due to these seven secrets we call the 7Ps.  The 7 Ps are so fundamental to writing and publishing that new technology enhances rather than reduces their power.

The First P is Passion.

Whatever your passion, you can immerse yourself in it AND create income with self publishing.  This can be your direct ticket to the kind of fulfillment you’ve always wanted.

Whether you want to travel the world or live as a recluse, work 12 hours a day or not work much at all,  you can set your schedule to succeed, if you’re willing to learn these seven secrets.

You can start part-time with any dream, passion, and budget.  Once you’ve created a product, you’ll enjoy the “multiple effect” of producing profits over and over again.

So the question is… What do you love to do?

What’s Your Passion:  An example is that thirty years ago, a client of Merri’s had a passion to help people who were in pain?  He published a series of pamphlets explaining various chiropractic disorders in very simple terms.  For example: “What Is Whiplash?”

The pamphlets contained solid information, but were simple 5″ x 7″ brochures with drawings and explanations. He sold them with a rack to chiropractors, who put them in their offices for patients to read.  These little self-published items sold year in and year out for decades.

There are thousands of ideas of this sort that can lead to big business.  It’s just a matter of defining and then acting on your passion.

Although I can work when I please and go where I wish, for me the most important reason for being a publisher is the satisfaction it brings. 

I love the projects I take on, so work doesn’t feel like, well… work.

What do you love?  If you love golf, then you can write and sell publications about golf.  Love travel, fishing, dogs, dolls, or art?  Write and sell publications in these fields.

Are you concerned about crime, war, poverty or environmental issues?  You can publish information products that help reduce these concerns.

Would you like to help the world be a more spiritual place?  Publish a newsletter, write a book (or hire someone to write it for you), record a tape… publish something that enlightens people.

Whatever your passion, you can immerse yourself in it and earn income by publishing for ereaders, print on demand, CDs, lists, bound books, or any format you choose.

Be immersed in your passion and get paid well for it. 

This is why stardom is not the main goal for most writers and self publishers.  Extra income, more freedom and fulfillment are usually more than enough enough.

The seven Ps are:

#1: Passion

#2: Problem

#3: Person

#4: Profitably Priced Product

#5: Prospecting Pathway

#6: Promise

#7: Presentation

The first time I exposed others to the secrets in Self Publishing was in a weekend “Writer’s Camp” seminar.  We offered the camp for $1,500. 80 delegates enrolled.  People from all walks of life attended—chiropractors, businessmen, investors, doctors, realtors, inventors, airline pilots, engineers, and housewives.

Merri and I were so overwhelmed by the response, we decided to make it available to a larger audience.  We created a written course based on our current self publishing activity called “Self Fulfilled – How to be a Self Publisher.”  Then we recorded the weekend “Writer’s Camp” seminar.

Thousands have used the course as it has evolved over the decades.

You can receive both the written course and the recorded weekend seminar, in an MP3 file, in a special “Live Well and Free Anywhere” program I am making available to you.  The normal fee is $299 for the written course and $299 for the recorded workshop.   I’ll send you both the course and the recorded workshop and my course “International Business Made EZ (also $299) all for $299.  You save $598.

We are so confident that you’ll gain from this offer that if you are not fully satisfied, simply email us within 60 days for a full refund .

These courses are not theoretical.  They describe, step-by-step, how Merri and I built a million-dollar international business and how we are running this self publishing business right now.   We use the 7Ps today just as we did four decades ago to create a strong annual income.

This correspondence course is for those who would like their own international self publishing micro business for fun and profit. If you want fun, freedom, extra income and fulfillment with your own full or part time writing or want to build your existing business, by writing to sell you can profit from this course.  The course can help who want their own business or who want to have a business together or a family business.  This is the perfect course for those who can no longer find employment, who are looking for ways to earn abroad and who wish to retire and supplement their income.

Whether you are retired, an investor, chiropractor, doctor, dentist, professional or already own your own business, this offers another way to make money, to turn your passion into profit. We guarantee that we have shared all we know to help you start and run your own international business.  Enjoy and live a life of following your Passion to Profit… through writing.

Here is a special offer. 

We provide two emailed courses  “Self Fulfilled – How to Write to Sell and be a Self Publisher” and “International Business Made EZ”.

We include the “Self Fulfilled Writing and Self Publishing Course” because there are two reasons to write, when you have something to say or when you have something to sell.  In this day and age many of us want to do both, make a statement that makes the world a better place and earn something extra in the process. 

Whatever your passion, however you do business, chances are you’ll be writing either to create a product or to sell a product. 

You save more than $598 because you also receive a recorded webinar conducted by our webmaster David Cross (at no extra cost).

David-cross-images tags:"2012-4-20"

David Cross

David has been our webmaster since our website began in the 1990s.  He is Merri’s and my business partner. We could not run our business as we do without him.

Learn the tactics we use in our web business that condenses 27 years of practical experience about search engine optimization, and writing for search engines.

For the last 27 years David has worked with companies large and small – IBM, Agora Publishing, AstraZeneca and many small business owners.  He has worked in 22 countries, and lived in six of them.

David’s clients span the globe and represent companies and charities both large and small.  From corporate giants to small, one-woman businesses and everything from finance, healthcare, publishing, technology, real estate, veterinarians, alternative health centers and everything in between.

David is an essential part of our web based business.

Myles Norin, CEO of Agora, Inc.  wrote:  “I have found David’s knowledge and experience unmatched in the industry.  Without David’s expertise and guidance for the past 7 years, we would not be nearly as successful as we are.”

As Senior Internet Consultant to Agora Inc. in Baltimore, MD, he worked closely with Agora’s publishers and marketers and – over a 7-year period – helped to propel Agora’s online revenues from around $20 million to well over $300 million.

David’s webinar will help you gain benefits in your micro business that large internet marketing companies use.  In this practical recorded workshop you will learn valuable skills to help your micro business.

There has never been a time when the opportunity for small businesses abroad has been so outstanding.  Expand your borders now!  Increase your economic security freedom, independence and success.

If you are not fully satisfied that this offers you enormous value simply email us for a full refund within 60 days.  You can keep all three courses as our thanks for giving our courses a try.

You also receive a report  “How to use Relaxed Concentration to Brainstorm Business Ideas” and a recorded workshop “How to Become and Remain Rich With Relaxed Concentration” at no additional cost.

Plus you get more in the program.

You receive regular writing and self publishing updates for a year.  Businesses usually need to evolve.  Merri and I continue to publish and have our independent businesses.  Some basics have remained for decades, but new strategies occur all the time throughout the year.  We’ll be sending along updates that share our most recent experiences as we learn and continue to grow our international micro business from Smalltown USA.

My special offer to you in this “Live Well and Free Anywhere Program”, is that you receive:

  • “International Business Made EZ” course
  • “Self Fulfilled – How to Write to Sell” course
  • Video Workshop by our webmaster David Cross,
  • The entire weekend “Writer’s Camp” in MP3,
  • MP3 Workshop “How to Gain Added Success With Relaxed Concentration”
  • Any updates to any of the courses, workshops, reports or recordings for a year.

We are so confident that you’ll gain from this offer that if you are not fully satisfied, simply email us within the first three months for a full refund . 

Order “Self Fulfilled – How to Publish to Sell” and a quarter of update lessons $79.   Click Here.

Order “Self Fulfilled – How to Publish to Sell” and a full year of update lessons $299.  Click Here.      

See success stories from Self Publishers and a few who have attended the “Writer’s Camp” that you will receive on MP3.

 

 

 

The Simplest Investments – Water I


As the world grows more complex the simplest investments can be the best.

Not much can be simpler than food, shelter and water.

On the subject of food… look towards local and non GMO.  There is a great movie “Genetic Roulette”.  It is still free for a few more days at www.geneticroulettemovie.com

Our sites will be looking increasingly at CSAs (Community Supported Agriculture) and local food investments in Ecuador and Smalltown USA.

Our sites have long looked at the benefits of investing in water.

_MG_0052

Part of a complex of Andean water sharing system above Cotacachi.

This is what I wrote at this site in 2001.

White ridges of wetness crash on sodden rock ripped by roaring currents that lash the creek bank and swell over its edge. Gushes of brown spray strain at greying wood. They sing a rushing song in harmony with the groaning bridge. Smells of damp leap through the willows. I feel this soggy touch and taste a pure, sweet cleansing that stings my lips. Just before I headed for the equator we had a long warm spell and torrents of rain. This melted the snow mass and turned our gentle creek into a lashing cascade. I stood on one of the small bridges that cross the creek and thought how blessed we are here with water. It falls on us, rushes down our creeks, bubbles up through the grass, springs from the hills and cascades from cracks in the rocks.

This is no mistake. Merri and I began looking for land with two goals, have altitude (to avoid air conditioning in summer and mosquitoes anytime) and have an abundance of water. We certainly attained both at Merrily Farms.

I have been writing for several years in my written World Reports that it makes sense to invest in water. When I was growing up in Portland we didn’t think it special to be able to drink sparkling clear Bull Run water fresh from the tap. Then I began to travel and was amused. The poor French, Mexicans and people in places where they could not drink water unless it was bottled! Ha ha, how strange I thought. How little did I know?

But where I really became aware of the growing water supply problem was when I returned to Florida. The diluted chlorine mixture coming from our tap in Naples was not only expensive but barely drinkable. And Merri’s Mom in Macon, Georgia was the first house after the chlorinization plant. The tap water would make your eyes burn!  I became concerned. Then when returning on a trip to visit my Mom in Portland I discovered that previously sweet pure water was chemically foul as well.

This was when I first became concerned.

We are too many. Too dirty.  Our water is too little.

So I started writing about investing in water. But where? There are a couple of big European public companies, Perrier, Generale des Euax, etc., but when I looked in the U.S. I couldn’t find anything. Checked a few of the small water bottlers and found most of them already owned by the Europeans. So how?

One way is to own land with water. That’s why Merri and I decided to go to the source and buy land with springs .
Each of our houses has its own gravity fed water supply from one of four separate springs. There are dozens of other springs on the land plus three rushing creeks.

But the granddaddy of them all is the “Indian Trough”. This is a huge spring where about three gallons a minute pours out of a large rock formation. It is a historic site because the natives here viewed it as sacred (when this land was their hunting lands). They gouged a trough in the rocks so they could drink from the spring face and their horses could water from the trough.

The water is said to be medicinal (one of our Shaman friends said it is especially good for urinary tract problems) and the locals have come here to collect it for generations. Mainly for their health, but one neighbor said his father was a famous moonshiner and only used this water to make his moonshine! The locals still come up to collect it and a dear friend whose brother was passing asked for some to take to the hospice. To drink this water was his brother’s dying wish.

We are blessed with this water and have built a wonderful Japanese Cedar Soaking Tub deep in the woods. The spring (which comes out at exactly 48 degree temperature year round) fills the 450 gallon tub (it can accommodate six people). A wood burning snorkel stove with heat exchangers is immersed in the water and heats it to the temperature desired (usually a little over 100 degrees). After the soak (and drinking lots of water while there) the tub is drained and filled again so no chemicals are needed.

This is one way I invest in water. But where else can we invest? This is a tricky question for me as I lack experience in the water industry.

Here are a few thoughts. Look at any industry that deals in water filtering or purification. Companies that build desalination plants would make sense and of course bottlers. There are several problems. One is pollution in the water. Another is not enough fresh water for drinking, cleaning and irrigation. Another problem is not enough of the right types of water in the right place.

This was good advice a decade ago and still is.

A September 26, 2012 USA TODAY article entitled “Nation’s water costs rushing higher” by Kevin McCoy, with Oliver St. John and Tom McGarrity contributing said:  While most Americans worry about gas and heating oil prices, water rates have surged in the past dozen years, according to a USA TODAY study of 100 municipalities. Prices at least doubled in more than a quarter of the locations and even tripled in a few.

Consumers could easily overlook the steady drip, drip, drip of water rate hikes, yet the cost of this necessity of life has outpaced the percentage increases of some of these other utilities, carving a larger slice of household budgets in the process.

“I don’t know how they expect people to keep paying more for water with the cost of gas and day care and everything else going up,” complains Jacquelyn Moncrief, 60, a Philadelphia homeowner who says the price hikes would force her to make food-or-water decisions.

The trend toward higher bills is being driven by:

— The cost of paying off the debt on bonds municipalities issue to fund expensive repairs or upgrades on aging water systems.

— Increases in the cost of electricity, chemicals and fuel used to supply and treat water.

The costs continue to rise even though residential water usage dropped sharply nationwide in the past three decades amid conservation efforts.

U.S. water systems will need as much as $1 trillion in infrastructure improvements by 2035 to keep up with drinking water needs, according to a survey of industry experts released in June.

The bond debt needed to fund those projects’ work will be passed on to consumers, including the many Americans struggling with the economic fallout of the great recession.

A virtually irreplaceable resource that Americans rely on for health and daily living “could potentially get more and more expensive,” says John Chevrette, who heads the management consulting arm of Black & Veatch, the firm that conducted the industry survey.

He predicts rate increases of 5% to 15% every few years, saying the cost of water “could take a larger and more significant bite out of otherwise disposable income.”

A 2010 report by the Water Research Foundation, a non-profit organization that studies drinking water issues, concluded that residential usage per customer dropped more than 380 gallons annually in the last 30 years, a changing era when conservation became more prevalent. Compounded over time, the report says the trend implies that a customer would have used 11,673 fewer gallons in 2008 than an identical customer in 1978, a 13.2% decline.

As a result, many water agencies have been forced to raise rates.

“When we explain that part of the reason you’re paying more is because you’re using less, that doesn’t go over real well with a lot of people,” says Joseph Clare, the Philadelphia Water Department’s deputy commissioner for finance and
administration.

The 2012 drought that continues to hold roughly half the nation in its grip has also had an impact on some water rates.

These charts from this USA Today article shows how much water rates have risen.

USA Today Photo

(Click on photos to enlarge)

These increases seem high but…

USA Today Photo

other cities have had higher rises and…

USA Today Photo

these areas had the worst water rate increases!

Now that so much of the world has been suffering droughts… this idea grows in value.

I invest in water in numerous ways.

First, I buy land with water in Smalltown USA and Ecuador.

Good water was a main prerequisite when we searched for our Smalltown USA farm.

gary-scott-farm

Little Horse Creek on our farm.

gary-scott-farm

Mossy creek on our farm.

gary-scott-farm

A sacred spring called the Indian Trough is a historical site on our farm and along with dozens of other springs  is our source of water… for drinking.

Merrily farms water

Water flowing from the sacred Indian Trough Spring.

The spring feeds our deep woods Ofuru, our pond and helps fill the creek.

Merrily farms water

Merrily Farms Ofuru… we soak at 107 degrees.

Merrily farms water

Our pond at Merrily Farms.

In this series we’ll look at water rights in Ecuador, water shares, how readers have been using Bio Wash on crops to reduce the impact of  dry conditions.

Gary

Go to Part Two of the “Investing in Water” Report – Click Here

Value Investing Webinar

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Learn how to improve the safety of your savings and investments by selecting good value and diversified investments in a multi-currency portfolio.

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Gain Protection First – Against the Dollar’s Purchasing Power Loss.  In 1913 the The Federal Reserve Act created the Federal Reserve Bank to protect the purchasing power of the US dollar, which has since lost about 94% of its purchasing power.  Here is its price compared with gold since 1900.

priced in gold

Dollar chart from pricedingold.com (1)

The Fed has let the dollar lose most of its strength plus has allowed interest rates to fall so low, that safe investments cannot keep pace with the drop in purchasing power.

multi-currency-chart

Chart from Grandfather Economic Report (2)

Many investors have forgotten about the risk of a falling dollar because the greenback has been strong for the past five years.  This temporary dollar strength came after the great recession of 2009 just as there was temporary dollar strength after the great recession of the 1980s.  Then about six years after the recession, an agreement was made by major governments to weaken the dollar.

There was a severe global economic recession affecting much of the developed world in the late 1970s and early 1980s.  The United States and Japan exited the recession relatively early, but high unemployment would continue to affect Europe and the UK through to at least 1985.  As a consequence between 1980 and 1985, the US dollar had appreciated by about 50% against the Japanese yen, Deutsche mark, French franc and British pound, the currencies of the next four biggest economies at the time. Then the governments reached an agreement and exchange rate values of the dollar versus the yen declined by 51% from 1985 to 1987.

Now the world is again in the same place.  The recession is over.  Europe is a bit behind in recovery and the dollar is higher than before the recession.

There is no reason for the greenback to be  strong.

The agreement in 1985 was called the Plaza Accord.   Over just two years the greenback dropped nearly 50% versus other major currencies.  The next accord will generate great profits for those who know what to do while it ruins the purchasing power of dollar back investments.

The strong US dollar and low interest rates have created one of the biggest stock and multi currency breakout opportunities in history.  Learn how to create a plan to profit from multi currency shifts ahead.

One reason for the potential gains is that stock markets and currency values are cyclical.  Due to low interest rates created by the 2009 economic downturn, the US and a few other equity markets have risen to some of their highest prices, ever.  These markets offer very poor value now.  The steep valuation creates incredible profit potential but also hides some enormous risks.  Learn how to develop an investing strategy based of earnings, cash flows, dividends and book values to increase potential for profit and reduce the risks.

Next Extra Profit Created by Value Breakouts

Over the history of US equity markets, the  price of overall markets have risen about 9.1 percent, respectively, compounded annually.  Yet over more than a hundred years of stock market activity,  a majority of the profits have come from just a very few dramatic breakouts.

Equity markets are ruled in the short term by emotions that create unpredictable ups and downs.  Numerous fears of defaults, worries of double dip recessions, high unemployment, concerns about fiscal cliffs, hold investors back.  Yet global population growth and advances in production and prosperity are relentless economic fundamentals that increase value.

When fear holds back a a fundamentally rising value, rising profit potential grows.  Values increase as prices stagnate.  Then markets break free and rocket upwards creating wealth, prosperity and growth.

Find out which breakouts are likely to take place next.

Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 years as shown in this graph.

stock-Charts

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns create war.

Here is the war stock cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WWIII) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Learn how the Cyber War (WWIV) may change the way we live and act and how this will affect currencies and investments.

Learn:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios), but his big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on a 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of outperformance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.  This rate of expansion by the way is called the “Golden Ratio”.  It is a mathematical formula that controls the growth of most natural things; trees, the shape of leaves, the spiral of shells, as well as the way economies and societies grow.

We’ll sum the strategy, how to leverage cheap, safe, quality stocks and for what period of time based on your circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 (almost) years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy investing more with slow, worry free, good value investing.  Stress, worry and fear are three of an investor’s worst enemies.  These are major foundations of the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market they choose.  The behavior gap is created by natural human responses to fear.  The losses created by this gap grow when investors trade short term under stress.

Learn how to put meaning into your investing by creating profitable strategies that combine good value investments with unique, personal goals.

Learn how to span the behavior gap.  Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse, when they should embrace risk.  Purpose is the most powerful motivator,  stronger than fear and greed.  One powerful way to overcome the behavior gap is to invest with a purpose.

Combine your needs and capabilities with the secrets and the math of our good value model portfolio.

Share ideas about my good value portfolio.  My personal investment portfolio comes from a continual analysis of international stock markets and a comparison of their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.

Markets included in this portfolio are:

• Norway
• Australia
• Hong Kong
• Japan
• Singapore
• United Kingdom
• Taiwan
• South Korea
• China

These markets have been chosen based on four pillars of valuation.

• Absolute Valuation
• Relative Valuation
• Current versus Historic Valuation
• Current Relative versus Relative Historic Valuation

Learn how to use Country ETFs to easily construct a diversified, risk-controlled, equally weighted representative country portfolios in all of these good value countries.

To achieve this goal my portfolio consists of Country Index ETFs that track an index of shares in a specific country.  These country ETFs provide diversification into a basket of equities in the good value countries.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

This is an easy, simple and effective approach to zeroing in on value because little management and guesswork is required.  You are investing in a diversified portfolio of good value indices.  A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to pick and choose shares.  You can invest in the index which is like investing in all the shares in the index.  All you have to do is invest in an ETF that in turn invests passively in all the shares of the index.

Learn the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed a test.

The Test for Low Cost Trading

Research put every part of this portfolio in place, except knowing the best, easiest and least expensive way to buy.  A search for an optimal way to buy and hold boiled down to two methods.  One tactic to test was to use a unique online broker that appeared to offer the lowest cost deal.  The other approach was to use a community bank in Smalltown USA.  The small town bank that I use looks after my 401K trust account and their service is first class.  The benefit of small banks is that they still treat us as a human beings (instead of a number) and when we need, it’s easy to go right to the top to answer a question or get a problem resolved.  There are no call centers and the bank and the person looking after my account is just around the corner.

I created a test to see which offered the least expensive service.

Working with my banker in Smalltown USA,  I created two accounts, one at the online broker and the other at the bank. I placed $40,000 in each.

I set up the order for the country ETFs online, while my trust manager set up orders for the identical amounts of the same shares in his system.  Then we got on the phone, coordinated our timing and on a count of three each pushed the button “BUY”.

The results of this test  show how you can gain on any purchase of country ETFs.

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ecuador-seminar

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#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip 2017” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

Subscribe to a Pi annual subscription for $197 and receive all the above.

Your subscription will be charged $299 a year from now, but you can cancel at any time.

Gary

 

Gary

(1) Dollar chart from pricedingold.com

(2) Grandfather Economic Report

 

Go to Part Two of the “Investing in Water” Report – Click Here

USA Today “Nation’s water costs rushing higher”